Japan’s Prime Minister Sanae Takaichi has given her blessing to the Bank of Japan’s decision to raise its policy rate to 1%, the highest level the country has seen since 1995. For a leader who spent the early months of 2026 publicly questioning whether rate hikes were a good idea, the pivot is notable.
The BOJ passed the increase on June 16 with a 7-1 vote, making it the second rate hike during Takaichi’s tenure.
From skeptic to supporter
Takaichi’s relationship with BOJ Governor Kazuo Ueda has not always been smooth. Earlier in 2026, she voiced reservations about further rate increases during meetings with Ueda, concerns that contributed to temporary weakness in the yen at the time.
Takaichi took office in October 2025 after winning the Liberal Democratic Party leadership election.
