Bank of Japan Raised Rates to 1%: What It Means

The Bank of Japan raised its key rate by 25 basis points to 1%, the highest level in the country since 1995. For traders, this matters not only because of the yen, but also because of how such a decision hits risk assets, including Bitcoin.

The decision was made amid inflationary pressure and rising global energy prices. According to the BoJ, the new parameters took effect on June 17, 2026: the complementary deposit facility rate is 1.0%, while the policy loan and discount rate, according to the regulator’s documents, was raised to 1.25%. Bank Governor Kazuo Ueda did not vote because he was in the hospital, and the meeting was chaired by Deputy Governor Ryozo Himino. This is not a minor detail. In Japan, the price of money is changing again, and markets are watching very closely.

Why is a rate hike in Japan important for the crypto market?

When a central bank makes money more expensive, investors often become more cautious. Less cheap financing, less appetite for risk. That is why BoJ rate hikes are usually tracked not only in Tokyo, but also in the crypto market, where Bitcoin and Ethereum often react to changes in global liquidity.

But this time the market was not spooked. The decision matched market expectations, and Reuters wrote that 66 of 70 economists in a June survey expected exactly a 1.0% rate by the end of June. In other words, there was almost no surprise. And one more thing: the BoJ did not just raise rates, it also signaled that it could keep moving in the same direction if the economy and prices confirm that path. That is why this move matters for more than one day. For those tracking BTC moves in hryvnia, it may also be useful to sell Bitcoin on Monobank if the market offers a convenient exit point.

What exactly did the Bank of Japan decide?

Following the meeting, the regulator raised the rate by 25 bps, from 0.75% to 1%. According to additional BoJ materials, the decision passed by 7 votes to 1. The dissent came from Toichiro Asada, who believed that risks to production and employment from the Middle East were greater than inflation risks.

In its assessment, the bank noted that core inflation, meaning CPI excluding fresh food, had recently been around 1.5% due to energy subsidies, but had previously exceeded 2% amid rising food prices, including rice. The BoJ expects inflation to become consistent with its 2% target in the second half of fiscal 2026 or in fiscal 2027. At the same time, the regulator will continue reducing purchases of JGB government bonds, lowering the monthly amount by ¥200 billion each quarter. This already looks like a slow exit from the very loose monetary policy that lasted for years.

“After twenty years of deflation, Japan has now entered a new inflation cycle,” said economist Esper Kall. According to him, emergency crisis measures are no longer needed, and the central bank is returning to normal policy.

Market reaction

Bitcoin barely reacted with any sharp move. CoinDesk noted that the price showed no significant volatility after the BoJ announcement, and the asset was trading near $66,300. According to other market data, BTC was around $65,725, with an intraday range of $65,393–67,122 and a change of −2.08% from the previous close.

The futures market was more nervous. According to CoinGlass, total liquidations over 24 hours exceeded $535 million, and more than 111,000 traders were affected. Longs accounted for about $160 million, shorts for $375 million. The biggest losses were in Bitcoin and Ethereum pairs, where losses amounted to roughly $130 million and $197 million. In other words, the spot market was almost calm, while leveraged positions were wiped out very quickly.

Against this backdrop, the Japanese stock market behaved very differently. After the decision, the Nikkei 225 rose to a new record above 70,000 points, while the yield on 10-year JGBs climbed to around 2.61–2.64%. For crypto traders, this is another reminder: sometimes macroeconomics does not hit price immediately, but it does hit high-risk positions. That is where the first blow shows up.

• The BoJ raised rates by 25 bps to 1%.

• This is the highest level for Japan since 1995.

• The decision was supported by 7 of the 8 voting members.

• BTC held near $66,300 without a sharp drop.

• Over 24 hours, liquidations exceeded $535 million.

• More than 111,000 traders were affected.

What does this mean for investors?

For those holding Bitcoin long term, the main signal is simple: Japan is no longer operating in a near-zero-rate mode, as it did for years. This reduces part of the global cheap liquidity that supported risk assets. But the market had already priced in part of this, so there was no sharp shock.

For active traders, the takeaway is harsher. If rates in Japan continue to rise, and the BoJ really does not want to “fall behind the curve,” as Deputy Governor Shinichi Uchida said, leveraged positions will become even more dangerous. Reuters пишет that the regulator is ready to keep raising rates depending on the economy and prices. In such a situation, it is important to watch not only Bitcoin itself, but also how the dollar, the yen, and bond yields behave. They often give a signal before crypto does.

There is one more practical detail for Ukrainian readers. If, after such news, you decide to convert part of your profit into hryvnia, it is worth doing so without rushing and watching the exchange rate at the moment of the trade. For that, you can quickly sell Bitcoin for hryvnia to a card.

Frequently asked questions

Why did the Bank of Japan raise rates now?

The BoJ explained the move by inflationary pressure and rising energy prices. The regulator also expects inflation to gradually move closer to its 2% target thanks to wage growth.

Why didn’t Bitcoin drop sharply after the decision?

Because the rate hike was expected. According to Reuters, 66 of 70 economists in a June survey forecast exactly 1.0%, so the market had already priced in that scenario.

Why were liquidations so large if BTC barely moved?

Because liquidations often hit leveraged positions even when the spot price does not move very much. Here, more than 111,000 positions worth more than $535 million were closed in 24 hours.

The bottom line is simple: the Bank of Japan raised rates to 1%, the highest since 1995, and the market is already starting to get used to the idea that the era of ultra-cheap money in Japan is coming to an end. For crypto, this is not an immediate blow, but it is another factor worth keeping in view, especially if you trade with leverage or plan to lock in profits in hryvnia.

This material is not financial advice. Cryptocurrency trading involves significant risks. Part of this text was prepared with the help of artificial intelligence based on public sources and reviewed by our editorial team.