Latest bank decision: At its meeting on 6 August, the Central Bank decided to hold the target for the overnight...
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 | 0.75 |
| 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 holds rates in July
Latest decision: At its meeting in late July, the Bank of Japan (BOJ) decided by an eight-to-one vote to hold its policy rate at 1.00%, its highest level since 1995. The move matched market expectations.
Bank in wait-and-see mode: The BOJ’s decision likely aimed to assess the impact of past monetary tightening before hiking rates further. The Bank was likely also keen to wait for more clarity on oil prices, which have been highly volatile of late.
Further tightening remains likely by the end of 2026: Most of our panelists expect one more 25-basis-point hike by year-end, consistent with the BOJ’s belief that core inflation will overshoot the 2% target from September. However, a minority see rates on hold.
Panelist insight: On the outlook, EIU analysts said: “The bank’s governor, Ueda Kazuo, stated in the post meeting press conference that the central bank recognised meaningful upside risks to inflation and that financial conditions remained accommodative. We interpret these comments to demonstrate the BOJ’s readiness to accelerate its monetary tightening, and expect the next interest rate increase to be announced at the central bank’s October policy meeting.”
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.
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