Japan Signals It Isn’t Done After Raising Rates to 30-Year High

It was a big, if somewhat anticipated, day for Japan watchers. The Bank of Japan raised its benchmark interest rate to the highest in 30 years and said more increases are in the pipeline if conditions allow — a sign of growing conviction that it can attain the stable inflation target it has pursued for more than a decade.

“I believe this rate hike was long overdue,” said Harumi Taguchi, principal economist at S&P Global Market Intelligence. The move underscored Governor Kazuo Ueda’s determination to keep raising rates as inflation gradually embeds itself into the economy. That’s a major shift from decades of weak prices following the early 1990s bursting of an asset bubble. Earlier Friday, data showed that a key gauge of consumer prices rose 3% in November, extending the streak of months at or above the BOJ’s 2% inflation target to 44.