Bank of Japan raises interest rates by 25 basis points. Bitcoin rises against yen
The Bank of Japan has raised interest rates to 1.25%, the highest level in 31 years, in an effort to combat inflation and stabilize the yen. The move has impacted global markets, including a rise in Bitcoin against the yen, as investors monitor the unwinding of the yen-based carry trade.
Why it matters
Changes in Japanese monetary policy have significant ripple effects on global liquidity and the valuation of risk assets like cryptocurrency.
The Bank of Japan (BOJ) raised its benchmark interest rate by 25 basis points on Friday, lifting it to 1.25%, the highest level in 31 years, as it battles sticky inflation and a chronically weak yen.
The move marks the central bank’s second hike in three months and comes weeks after U.S. Treasury Secretary Scott Bessent publicly pressed Tokyo to tighten faster to support yen. He argued that an orderly yen market benefits Treasury market stability and defended the coordinated yen-buying intervention as serving U.S. interests.
The bitcoin-Japanese yen pair (BTC/JPY) listed on Tokyo-based bitFlyer exchange extended gains by a 0.5% to JPY 12.06 million following the BOJ rate hike. BTC’s dollar-denominated price held largely steady at around $76,900, data from CoinDesk show.
The Japanese yen depreciated against the U.S. dollar, lifting the USD/JPY pair to 156.70 from 156.20.
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