Bank of Japan keeps rates steady at 1% with one dissenting vote favoring a 25 basis points hike amid rising inflation expectations.
The Euro climbed to 185.20 against the Japanese Yen following the Bank of Japan’s decision to maintain interest rates at 1%. The vote was 8-1, with Hajime Takata dissenting in favor of a 25 basis points increase to 1.25%.
The BoJ last raised rates by 25 basis points in June, bringing borrowing costs to their highest since 1995. Markets had anticipated the hold, as consecutive hikes were unlikely. The central bank signaled further tightening, citing rising medium-to-long-term inflation expectations.
Investors now await Eurozone inflation data for July, with expectations of a modest uptick to 2.9% year-over-year. Recent German and Spanish figures showed faster-than-expected inflation growth.