At its meeting that concluded Friday morning, December 19, the Bank of Japan decided to change its monetary policy for the first time since January, as expected, raising interest rates by 25 basis points to 0.75%. The decision, a unanimous vote by members, brings the rate to its highest level in three decades.

The bank’s statement indicated that, given the developments in economic activity and prices, it was appropriate to adjust monetary policy to achieve its 2% price stability target sustainably. It is expected that real interest rates will remain significantly negative following the change in the key interest rate and that accommodative financial conditions will continue to strongly support economic activity.