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| Version 1 | Version 2 |
|---|---|
| Japan ups interest rates to 0.5% | Japan ups interest rates to 0.5% |
| (about 1 hour later) | |
| Japan's central bank has raised interest rates to 0.5% following signs of steady growth in the economy. | Japan's central bank has raised interest rates to 0.5% following signs of steady growth in the economy. |
| It said the decision - only its second interest rate rise in more than six years - had been made because Japan's recovery was likely to continue. | It said the decision - only its second interest rate rise in more than six years - had been made because Japan's recovery was likely to continue. |
| Worries about the US and other overseas economies had also diminished, it said. | Worries about the US and other overseas economies had also diminished, it said. |
| In July last year, the bank raised the rate to 0.25% following six years of zero interest rates designed to help the economy recover. | In July last year, the bank raised the rate to 0.25% following six years of zero interest rates designed to help the economy recover. |
| Rate pause? | Rate pause? |
| The bank's nine-member monetary policy board voted 8-1 in favour of the latest rise, but said future rises would be made only gradually. | The bank's nine-member monetary policy board voted 8-1 in favour of the latest rise, but said future rises would be made only gradually. |
| In a statement following the decision, the central bank reiterated that it planned to adjust interest rates gradually. | |
| Many economists now think that another rate rise will not come for at least another six months. | Many economists now think that another rate rise will not come for at least another six months. |
| "It reduces the likelihood of further rate hikes going forward," according to Glenn Maguire, chief economist at SG Hong Kong. | "It reduces the likelihood of further rate hikes going forward," according to Glenn Maguire, chief economist at SG Hong Kong. |
| Market response | |
| The belief that there is unlikely to be another increase soon sent the yen falling against the dollar and the euro. | |
| The currency had initially risen on the first reports that the Bank of Japan governor, Toshihiko Fukui, had proposed a rate rise, but it changed direction shortly after the decision was announced. | |
| The doubling of interest rates still leaves Japan well below the benchmark rates of 5.25% in the US and 3.5% in the eurozone. | The doubling of interest rates still leaves Japan well below the benchmark rates of 5.25% in the US and 3.5% in the eurozone. |
| Tokyo's Nikkei share average ended down 0.14% but the broader TOPIX index rose 0.2% to its highest finish in more than 15 years. | |
| Banks have been boosted by hopes that rising interest rates will improve their lending margins. |