The central bank policy rate in Japan stood at 0.5 percent in February 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 uncollaterized overnight call rate to remain at 0.25 percent. A third rate hike to 0.5 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.

As of March 2025, the average interest rate on ordinary deposits of financial institutions in Japan stood at around 0.16 percent per annum. In the past years, the average interest rate on ordinary deposits had been close to zero percent. It rose to 0.02 percent after the central bank policy rate hike in March 2024.

Graph and download economic data for Japanese Yen to U.S. Dollar Spot Exchange Rate (AEXJPUS) from 1971 to 2024 about Japan, exchange rate, currency, rate, and USA.

As of March 2025, the average interest rate on new one-year time deposits of 10 million yen or more of banks in Japan was around 0.21 percent per annum. The rate increased from 0.01 percent in April 2024, following the central bank's first interest hike in 17 years.

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In the fiscal year 2023, the loan to deposit spread in the domestic business of banks in Japan reached 0.27 percent. The loan to deposit spread is the difference between a bank's lending rate and deposit rate.

As of December 2024, the average interest rate on new time deposits of 10 million yen or more of banks in Japan reached 0.31 percent per annum for time deposits with a maturity of two to under three years and three to under six months. Fixed-term deposits with a maturity of six months to less than one year reached an interest rate of 0.29 percent per annum.

In March 2025, the median interest rate of 10-year fixed rate housing loans provided by city banks in Japan stood at 4.34 percent. City banks are among the largest banks in Japan.

The Japan foreign exchange market size reached USD 55.2 Billion in 2024. Looking forward, IMARC Group expects the market to reach USD 111.9 Billion by 2033, exhibiting a growth rate (CAGR) of 8.2% during 2025-2033. The shifting consumer inclination toward currency trading, inflating disposable incomes, and higher interest rates of foreign exchange rates represent some of the key factors driving the market.

IMARC Group provides an analysis of the key trends in each segment of the Japan foreign exchange market report, along with forecasts at the country level for 2025-2033. Our report has categorized the market based on counterparty and type.

In 2024, the three-month interest rate in Japan reached 0.33 percent. The three-month interest rate is the rate at which a prime bank is willing to lend funds to another prime bank for three months. It is a reference for short-term interest rates in the money market.

Japan IMPI: CB: FF: Feedstuffs: Feedstuffs data was reported at 102.800 2010=100 in Dec 2016. This records a decrease from the previous number of 104.300 2010=100 for Nov 2016. Japan IMPI: CB: FF: Feedstuffs: Feedstuffs data is updated monthly, averaging 107.850 2010=100 from Jan 2010 (Median) to Dec 2016, with 84 observations. The data reached an all-time high of 127.100 2010=100 in Jun 2014 and a record low of 95.200 2010=100 in Nov 2011. Japan IMPI: CB: FF: Feedstuffs: Feedstuffs data remains active status in CEIC and is reported by Bank of Japan. The data is categorized under Global Database’s Japan – Table JP.I235: Import Price index: 2010=100: Contract Currency Basis: Foodstuffs & Feedstuffs.

Japan ExPI: CCB: CP: CRP: Printing Ink data was reported at 115.800 2020=100 in Dec 2024. This stayed constant from the previous number of 115.800 2020=100 for Nov 2024. Japan ExPI: CCB: CP: CRP: Printing Ink data is updated monthly, averaging 108.000 2020=100 from Jan 2020 (Median) to Dec 2024, with 60 observations. The data reached an all-time high of 115.800 2020=100 in Dec 2024 and a record low of 99.300 2020=100 in Jul 2021. Japan ExPI: CCB: CP: CRP: Printing Ink data remains active status in CEIC and is reported by Bank of Japan. The data is categorized under Global Database’s Japan – Table JP.I137: Export Price Index: 2020=100: Contract Currency Basis: Chemical & Related Products.

In February 2025, the long-term prime lending rate in Japan was 2.2 percent per annum. The long-term prime lending rate is an interest rate for long-term loans of one year or more to companies with high credit ratings set by Mizuho Bank.

In 2024, Japan's gross domestic product (GDP) grew by three percent at current prices, according to the second preliminary announcement in March 2025. A year earlier, the highest growth rate of Japan’s nominal GDP in almost three decades was recorded. The nominal GDP measures the value of all goods and services produced in an economy, including price changes. GDP growth and inflation Japan’s real GDP growth, which is adjusted for inflation, was lower at 0.1 percent. After decades of struggling with deflation and attempts to reach a two percent inflation target with economic stimulus packages and monetary easing policies, consumer prices in Japan increased by almost 3.3 percent in 2023, led by global inflation. This development prompted the Bank of Japan to shift its monetary policy and raise the short-term interest rate for the first time in 17 years in 2024. Japan lost its status as the third-largest economy Many countries have raised interest rates in response to higher inflation in the past years. Since Japan’s central bank has done so at a much slower pace, a widening interest gap emerged between Japan and other major economies of the world. This is also one of the reasons for the depreciation of the yen against the dollar. Due to the weak yen, Japan’s GDP declined when converted into U.S. dollars, resulting in Japan losing its status as the third-largest economy in terms of GDP to Germany in 2023.

The nominal effective exchange rate index of the Japanese yen stood at 73.87 points in January 2025. The real effective exchange rate index, which considers inflation in Japan and other economies, stood at 71.08 points.

In March 2025, the median interest rate of fixed rate housing loans for a selected period of five years provided by city banks in Japan stood at 4.11 percent, reaching a new high. City banks are among the largest banks in Japan.

In December 2024, the short-term prime lending rate in Japan was about 1.63 percent per annum. The prime lending rate is the most frequent interest rate charged by the majority of city banks on short-term loans to the most creditworthy clients.

In 2024, the average contract interest rate on new long-term loans and discounts of domestically licensed banks in Japan was 1.07 percent per annum. This represented an increase from 0.87 percent in the previous year.

Between January and June 2024, the average interest rate for new time deposits of three to less than 10 million Japanese yen with a maturity of three to less than six months in Japan stood at about 0.21 percent per annum. The average interest rate increased by 0.02 percentage points year on year for all deposited amounts.

In January 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 early 2025, Russia maintained the highest interest rate at 21 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 0.5 percent in January 2025. In contrast, Russia maintained a high inflation rate of 9.9 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.