The benchmark interest rate in Japan was last recorded at 0.50 percent. This dataset provides - Japan Interest Rate - actual values, historical data, forecast, chart, statistics, economic calendar and news.

The central bank policy rate in Japan stood at *** percent in October 2025. In March 2024, the Bank of Japan raised short-term interest rates for the first time in 17 years, ending its negative interest rate policy. From August 2024 onwards, the central bank encouraged the uncollateralized overnight call rate to remain at **** percent. A third rate hike to *** percent was implemented in January 2025. In 2016, the Bank of Japan had introduced a policy of quantitative and qualitative monetary easing (QQE) with yield curve control, one component of which included controlling short-term and long-term interest rates through market operations.

In September 2025, global inflation rates and central bank interest rates showed significant variation across major economies. Most economies initiated interest rate cuts from mid-2024 due to declining inflationary pressures. The U.S., UK, and EU central banks followed a consistent pattern of regular rate reductions throughout late 2024. In September 2025, Russia maintained the highest interest rate at 17 percent, while Japan retained the lowest at 0.5 percent. Varied inflation rates across major economies The inflation landscape varies considerably among major economies. China had the lowest inflation rate at -0.3 percent in September 2025. In contrast, Russia maintained a high inflation rate of 8 percent. These figures align with broader trends observed in early 2025, where China had the lowest inflation rate among major developed and emerging economies, while Russia's rate remained the highest. Central bank responses and economic indicators Central banks globally implemented aggressive rate hikes throughout 2022-23 to combat inflation. The European Central Bank exemplified this trend, raising rates from 0 percent in January 2022 to 4.5 percent by September 2023. A coordinated shift among major central banks began in mid-2024, with the ECB, Bank of England, and Federal Reserve initiating rate cuts, with forecasts suggesting further cuts through 2025 and 2026.

The benchmark interest rate in the United States was last recorded at 4 percent. This dataset provides the latest reported value for - United States Fed Funds Rate - plus previous releases, historical high and low, short-term forecast and long-term prediction, economic calendar, survey consensus and news.

From January 2022 to October 2025, a global trend emerged as almost all advanced and emerging economies increased their central bank policy rates. This widespread tightening of monetary policy was in response to inflationary pressures and economic challenges. However, a shift occurred in the latter half of 2025, with most countries beginning to lower their rates, signaling a new phase in the global economic cycle and monetary policy approach. Since September 2023, ****** has consistently held the highest interest rate among the observed countries.

The benchmark interest rate in Brazil was last recorded at 15 percent. This dataset provides - Brazil Interest Rate - actual values, historical data, forecast, chart, statistics, economic calendar and news.

Japan Key Interest Rate: Central Banks data was reported at 1.250 % in 2026. This records an increase from the previous number of 0.750 % for 2025. Japan Key Interest Rate: Central Banks data is updated yearly, averaging 0.100 % from Dec 1988 (Median) to 2026, with 39 observations. The data reached an all-time high of 5.625 % in 1990 and a record low of -0.100 % in 2023. Japan Key Interest Rate: Central Banks data remains active status in CEIC and is reported by Organisation for Economic Co-operation and Development. The data is categorized under Global Database’s Japan – Table JP.OECD.EO: Interest Rate: Forecast: OECD Member: Annual.

The benchmark interest rate in Russia was last recorded at 16.50 percent. This dataset provides the latest reported value for - Russia Interest Rate - plus previous releases, historical high and low, short-term forecast and long-term prediction, economic calendar, survey consensus and news.

In June 2024, the European Central Bank (ECB) began reducing its fixed interest rate for the first time since 2016, implementing a series of cuts. The rate decreased from 4.5 percent to 3.15 percent by year-end: a 0.25 percentage point cut in June, followed by additional reductions in September, October, and December. The central bank implemented other cuts in the first half of 2025, setting the rate at 2.15 percent in June 2025. This marked a significant shift from the previous rate hike cycle, which began in July 2022 when the ECB raised rates to 0.5 percent and subsequently increased them almost monthly, reaching 4.5 percent by December 2023 - the highest level since the 2007-2008 global financial crisis. How does this ensure liquidity? Banks typically hold only a fraction of their capital in cash, measured by metrics like the Tier 1 capital ratio. Since this ratio is low, banks prefer to allocate most of their capital to revenue-generating loans. When their cash reserves fall too low, banks borrow from the ECB to cover short-term liquidity needs. On the other hand, commercial banks can also deposit excess funds with the ECB at a lower interest rate. Reasons for fluctuations
The ECB’s primary mandate is to maintain price stability. The Euro area inflation rate is, in theory, the key indicator guiding the ECB's actions. When the fixed interest rate is lower, commercial banks are more likely to borrow from the ECB, increasing the money supply and, in turn, driving inflation higher. When inflation rises, the ECB increases the fixed interest rate, which slows borrowing and helps to reduce inflation.

The benchmark interest rate in Taiwan was last recorded at 2 percent. This dataset provides the latest reported value for - Taiwan Interest Rate - plus previous releases, historical high and low, short-term forecast and long-term prediction, economic calendar, survey consensus and news.

The benchmark interest rate in South Korea was last recorded at 2.50 percent. This dataset provides - South Korea Interest Rate - actual values, historical data, forecast, chart, statistics, economic calendar and news.

August 2024 marked a significant shift in the UK's monetary policy, as it saw the first reduction in the official bank base interest rate since August 2023. This change came after a period of consistent rate hikes that began in late 2021. In a bid to minimize the economic effects of the COVID-19 pandemic, the Bank of England cut the official bank base rate in March 2020 to a record low of *** percent. This historic low came just one week after the Bank of England cut rates from **** percent to **** percent in a bid to prevent mass job cuts in the United Kingdom. It remained at *** percent until December 2021 and was increased to one percent in May 2022 and to **** percent in October 2022. After that, the bank rate increased almost on a monthly basis, reaching **** percent in August 2023. It wasn't until August 2024 that the first rate decrease since the previous year occurred, signaling a potential shift in monetary policy. Why do central banks adjust interest rates? Central banks, including the Bank of England, adjust interest rates to manage economic stability and control inflation. Their strategies involve a delicate balance between two main approaches. When central banks raise interest rates, their goal is to cool down an overheated economy. Higher rates curb excessive spending and borrowing, which helps to prevent runaway inflation. This approach is typically used when the economy is growing too quickly or when inflation is rising above desired levels. Conversely, when central banks lower interest rates, they aim to encourage borrowing and investment. This strategy is employed to stimulate economic growth during periods of slowdown or recession. Lower rates make it cheaper for businesses and individuals to borrow money, which can lead to increased spending and investment. This dual approach allows central banks to maintain a balance between promoting growth and controlling inflation, ensuring long-term economic stability. Additionally, adjusting interest rates can influence currency values, impacting international trade and investment flows, further underscoring their critical role in a nation's economic health. Recent interest rate trends Between 2021 and 2025, most advanced and emerging economies experienced a period of regular interest rate hikes. This trend was driven by several factors, including persistent supply chain disruptions, high energy prices, and robust demand pressures. These elements combined to create significant inflationary trends, prompting central banks to raise rates to temper spending and borrowing. However, in 2024, a shift began to occur in global monetary policy. The European Central Bank (ECB) was among the first major central banks to reverse this trend by cutting interest rates. This move signaled a change in approach aimed at addressing growing economic slowdowns and supporting growth.

Table of the evolution of European Central Bank interest rates

The benchmark interest rate in Hong Kong was last recorded at 4.25 percent. This dataset provides the latest reported value for - Hong Kong Interest Rate - plus previous releases, historical high and low, short-term forecast and long-term prediction, economic calendar, survey consensus and news.

Monthly and long-term Japan Interest Rate data: historical series and analyst forecasts curated by FocusEconomics.

The benchmark interest rate in Thailand was last recorded at 1.50 percent. This dataset provides - Thailand Interest Rate - actual values, historical data, forecast, chart, statistics, economic calendar and news.

The U.S. federal funds effective rate underwent a dramatic reduction in early 2020 in response to the COVID-19 pandemic. The rate plummeted from 1.58 percent in February 2020 to 0.65 percent in March and further decreased to 0.05 percent in April. This sharp reduction, accompanied by the Federal Reserve's quantitative easing program, was implemented to stabilize the economy during the global health crisis. After maintaining historically low rates for nearly two years, the Federal Reserve began a series of rate hikes in early 2022, with the rate moving from 0.33 percent in April 2022 to 5.33 percent in August 2023. The rate remained unchanged for over a year before the Federal Reserve initiated its first rate cut in nearly three years in September 2024, bringing the rate to 5.13 percent. By December 2024, the rate was cut to 4.48 percent, signaling a shift in monetary policy in the second half of 2024. In January 2025, the Federal Reserve implemented another cut, setting the rate at 4.33 percent, which remained unchanged until September 2025, when another cut set the rate at 4.22 percent. In October 2025, the rate was further reduced to 4.09 percent. What is the federal funds effective rate? The U.S. federal funds effective rate determines the interest rate paid by depository institutions, such as banks and credit unions, that lend reserve balances to other depository institutions overnight. Changing the effective rate in times of crisis is a common way to stimulate the economy, as it has a significant impact on the whole economy, such as economic growth, employment, and inflation. Central bank policy rates The adjustment of interest rates in response to the COVID-19 pandemic was a coordinated global effort. In early 2020, central banks worldwide implemented aggressive monetary easing policies to combat the economic crisis. The U.S. Federal Reserve's dramatic reduction of its federal funds rate—from 1.58 percent in February 2020 to 0.05 percent by April—mirrored similar actions taken by central banks globally. While these low rates remained in place throughout 2021, mounting inflationary pressures led to a synchronized tightening cycle beginning in 2022, with central banks pushing rates to multi-year highs. By mid-2024, as inflation moderated across major economies, central banks began implementing their first rate cuts in several years, with the U.S. Federal Reserve, Bank of England, and European Central Bank all easing monetary policy.

From 2003 to 2025, the central banks of the United States, United Kingdom, and European Union exhibited remarkably similar interest rate patterns, reflecting shared global economic conditions. In the early 2000s, rates were initially low to stimulate growth, then increased as economies showed signs of overheating prior to 2008. The financial crisis that year prompted sharp rate cuts to near-zero levels, which persisted for an extended period to support economic recovery. The COVID-19 pandemic in 2020 led to further rate reductions to historic lows, aiming to mitigate economic fallout. However, surging inflation in 2022 triggered a dramatic policy shift, with the Federal Reserve, Bank of England, and European Central Bank significantly raising rates to curb price pressures. As inflation stabilized in late 2023 and early 2024, the ECB and Bank of England initiated rate cuts by mid-2024. Moreover, the Federal Reserve also implemented its first cut in three years, with forecasts suggesting a gradual decrease in all major interest rates between 2025 and 2026. Divergent approaches within the European Union While the ECB sets a benchmark rate for the Eurozone, individual EU countries have adopted diverse strategies to address their unique economic circumstances. For instance, Hungary set the highest rate in the EU at 13 percent in September 2023, gradually reducing it to 6.5 percent by October 2024. In contrast, Sweden implemented more aggressive cuts, lowering its rate to 2.15 percent by October 2025, the lowest among EU members. These variations highlight the complex economic landscape that European central banks must navigate, balancing inflation control with economic growth support. Global context and future outlook The interest rate changes in major economies have had far-reaching effects on global financial markets. Government bond yields, for example, reflect these policy shifts and investor sentiment. As of October 2025, the United States had the highest 10-year government bond yield among developed economies at 4.09 percent, while Switzerland had the lowest at 0.27 percent. These rates serve as important benchmarks for borrowing costs and economic expectations worldwide.

The enduring discourse regarding the effectiveness of interest rate policy in mitigating inflation within developing economies is characterized by the interplay of structural and supply-side determinants. Moreover, extant academic literature fails to resolve the direction of causality between inflation and interest rates. Nevertheless, the prevalent adoption of interest rate-based monetary policies in numerous developing economies raises a fundamental inquiry: What motivates central banks in these nations to consistently espouse this strategy? To address this inquiry, our study leverages wavelet transformation to dissect interest rate and inflation data across a spectrum of frequency scales. This innovative methodology paves the way for a meticulous exploration of the intricate causal interplay between these pivotal macroeconomic variables for twenty-two developing economies using monthly data from 1992 to 2022. Traditional literature on causality tends to focus on short- and long-run timescales, yet our study posits that numerous uncharted time and frequency scales exist between these extremes. These intermediate scales may wield substantial influence over the causal relationship and its direction. Our research thus extends the boundaries of existing causality literature and presents fresh insights into the complexities of monetary policy in developing economies. Traditional wisdom suggests that central banks should raise interest rates to combat inflation. However, our study uncovers a contrasting reality in developing economies. It demonstrates a positive causal link between the policy rate and inflation, where an increase in the central bank’s interest rates leads to an upsurge in price levels. Paradoxically, in response to escalating prices, the central bank continues to heighten the policy rate, thereby perpetuating this cyclical pattern. Given this observed positive causal relationship in developing economies, central banks must explore structural and supply-side factors to break this cycle and regain control over inflation.

The benchmark interest rate in Mexico was last recorded at 7.25 percent. This dataset provides - Mexico Interest Rate - actual values, historical data, forecast, chart, statistics, economic calendar and news.