Latest bank decision: At its meeting on 27 May, the Central Bank decided to hold the Official Cash Rate (OCR)...
BOJ Policy Rate in Japan
Japan's central bank maintained ultra-low policy rates over the decade to 2023, as part of its aggressive monetary easing strategy to combat deflation and stimulate economic growth. The Bank of Japan even adopted negative interest rates from 2016, reflecting its ongoing battle against deflationary pressures and a stagnant economy. That said, the bank moved rates back into positive territory in 2024 in response to robust price pressures and a weak yen.
The boj policy rate ended 2024 at 0.25%, compared to the end-2023 value of -0.10% and the figure a decade earlier of 0.10%. It averaged -0.03% over the last decade. For more interest rate information, visit our dedicated page.
Japan Interest Rate Chart
Note: This chart displays Policy Interest Rate (%) for Japan from 2014 to 2025.
Source: Macrobond.
Japan Interest Rate Data
| 2021 | 2022 | 2023 | 2024 | 2025 | |
|---|---|---|---|---|---|
| BOJ Policy Rate (%, eop) | -0.10 | -0.10 | -0.10 | 0.25 | 0.69 |
| TONAR (%, eop) | -0.02 | -0.02 | -0.04 | 0.23 | 0.73 |
| 10-Year Bond Yield (%, eop) | 0.07 | 0.41 | 0.62 | 1.08 | 2.06 |
Bank of Japan maintains rate in April
BOJ stands pat again: At its meeting on 28 April, the Bank of Japan (BOJ) decided by a six-to-three vote to keep its policy rate at 0.75%. The decision was in line with market expectations.
The Middle East conflict drives a cautious stance: The BOJ’s decision was influenced by the uncertainty over the U.S.-Iran war, with elevated oil prices pushing up inflation in March. The Bank struck a hawkish tone: Three board members voted for a hike, inflation forecasts were revised sharply higher, and Governor Kazuo Ueda said upside price risks currently outweigh downside growth risks. Still, the BOJ refrained from hiking for now as it awaits more clarity on the impact of the Middle East conflict on economic growth and prices.
Further tightening expected by end-2026: The BOJ affirmed that it will begin raising rates again ahead. All of our panelists expect further tightening by the end of 2026, with several now expecting more than one hike this year. Much will depend on the course of the U.S.-Iran war: a prolonged disruption in the Strait of Hormuz would likely lift inflation and lead the BOJ to tighten monetary policy further. The BOJ will reconvene on 15–16 June.
Panelist insight: ING’s Min Joo Kang and Chris Turner commented: “The 3-to-6 split is the largest divide among board members during Ueda’s governorship. We assume the split votes indicate that board discussions should focus on the timing of the rate hike, rather than the direction. […] Board members Takata (who dissented in March), Tamura, and Nakagawa dissented. While Takata and Tamura are known for their hawkish views, Nakagawa's stance was quite unexpected, as she is considered among the doves. Her term ends June 29 after June 16 meeting, making a June rate hike more likely.”
Consensus Forecasts and Projections for the next ten years
How should you choose a forecaster if some are too optimistic while others are too pessimistic? FocusEconomics collects Japanese interest rate projections for the next ten years from a panel of 31 analysts at the leading national, regional and global forecast institutions. These projections are then validated by our in-house team of economists and data analysts and averaged to provide one Consensus Forecast you can rely on for each indicator. By averaging all forecasts, upside and downside forecasting errors tend to cancel each other out, leading to the most reliable interest rate forecast available for Japanese interest rate.
Download one of our sample reports to visualize what a Consensus Forecast is and see our Japanese interest rate projections.
Want to get access to the full dataset of Japanese interest rate forecasts? Send an email to info@focus-economics.com.
Latest Global Monetary Policy News
-
New Zealand: Central Bank holds rates in May -
Israel: Central Bank cuts rates in May Latest bank decision: At its meeting on 25 May, the Central Bank decided to cut its policy rate from 4.00%... -
Hungary: Central Bank stands pat in May Hold aligns with market expectations: On 26 May, Magyar Nemzeti Bank (MNB) left the base rate unchanged at 6.25% for... -
Egypt: Central Bank of Egypt holds rates in May CBE maintains pause on easing cycle: At its meeting on 21 May, the Central Bank of Egypt (CBE) decided to... -
Costa Rica: Central Bank of Costa Rica maintains rates in May The BCCR extends pause into a third meeting: At its meeting on 21 May, the Central Bank of Costa Rica... -
Romania: NBR keeps interest rates in May at highest level in the EU National Bank of Romania holds fire, as expected: At its meeting on 15 May, the National Bank of Romania (NBR)... -
Angola: Central Bank of Angola reduces rates in May 5-point cut brings cumulative easing to 250 basis points: At its meeting on 14 May, the National Bank of Angola...