Fri Dec 19 03:40:00 UTC 2025: News Article:

Asia-Pacific Markets Rally After Bank of Japan Hikes Rates to Three-Decade High

Asian-Pacific markets experienced broad gains Friday as investors digested the Bank of Japan’s (BOJ) decision to raise its benchmark interest rate for the first time in nearly 30 years. The move, a 25-basis point increase to 0.75%, brings the rate to its highest level since 1995 and aligns with economist expectations. The BOJ’s decision reflects its commitment to normalizing monetary policy as inflation remains above target levels.

Japan’s Nikkei 225 led the charge, climbing 1.33%, while the Topix rose 1.06%. However, the Japanese yen weakened against the dollar, trading at 156.06, a 0.33% decrease. Analysts suggest the Ministry of Finance may be closely monitoring the yen’s depreciation and could intervene in currency markets during periods of low liquidity.

Elsewhere in the region, South Korea’s Kospi gained 0.77%, and the Kosdaq jumped 1.49%. Australia’s S&P/ASX 200 rose 0.51%, while Hong Kong’s Hang Seng index and the mainland CSI 300 both saw gains of approximately 0.6%.

The positive momentum in Asia followed a strong showing on Wall Street Thursday. The S&P 500 snapped a four-day losing streak, buoyed by softer-than-expected inflation data, which has fueled optimism for potential interest rate cuts in 2026. The S&P 500 rose 0.79%, the Nasdaq Composite advanced 1.38%, and the Dow Jones Industrial Average gained 0.14%.

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