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 June 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 **** 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.

Deposit Interest Rate in Japan increased to 0.23 percent in June from 0.22 percent in May of 2025. This dataset includes a chart with historical data for Deposit Interest Rate in Japan.

In June 2025, the average uncollateralized overnight call rate in Japan stood at **** percent. The end-of-month rate also reached **** percent. On March 21, 2024, the Bank of Japan ended its negative interest rate policy and made a shift to encouraging the uncollateralized overnight call rate to remain between *** and *** percent. In its July 2024 Monetary Policy Meeting, the bank decided to raise the short-term interest rate to **** percent. In January 2025, a third rate hike to *** percent was implemented.

Japan JP: Risk Premium on Lending: Lending Rate Minus Treasury Bill Rate data was reported at 1.273 % pa in 2016. This records an increase from the previous number of 1.155 % pa for 2015. Japan JP: Risk Premium on Lending: Lending Rate Minus Treasury Bill Rate data is updated yearly, averaging 1.922 % pa from Dec 1960 (Median) to 2016, with 55 observations. The data reached an all-time high of 2.900 % pa in 1978 and a record low of 1.155 % pa in 2015. Japan JP: Risk Premium on Lending: Lending Rate Minus Treasury Bill Rate data remains active status in CEIC and is reported by World Bank. The data is categorized under Global Database’s Japan – Table JP.World Bank.WDI: Interest Rates. Risk premium on lending is the interest rate charged by banks on loans to private sector customers minus the 'risk free' treasury bill interest rate at which short-term government securities are issued or traded in the market. In some countries this spread may be negative, indicating that the market considers its best corporate clients to be lower risk than the government. The terms and conditions attached to lending rates differ by country, however, limiting their comparability.; ; International Monetary Fund, International Financial Statistics database.; ;

In May 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 20 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 -0.1 percent in May 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.

Historical chart and dataset showing Japan inflation rate by year from 1960 to 2024.

Government bond spreads as of April 15, 2025, varied widely among the largest economies when compared to German Bunds and U.S. Treasury notes. The United Kingdom's bond spread was the higest against both, with ***** basis points (bps) over Germany and **** bps over the U.S. In contrast, China and Japan display negative spreads, with Japan having the lowest spread at ****** bps against U.S. Treasuries. Italy, the United Kingdom, and Canada showed moderate spreads. Positive bond spreads indicate that a country’s government bonds have higher yields compared to the benchmark bonds - in this case, the German Bunds and U.S. Treasury notes. Higher spreads often signal perceived higher risk or economic uncertainty, as investors demand greater returns for holding these bonds. expectations. Conversely, negative spreads mean that these bonds offer lower yields than the benchmark. Negative spreads often indicate strong investor confidence, safe-haven status, or lower inflation expectations, as investors are willing to accept lower returns for the perceived stability of these bonds.

Cross currency swap differs from single currency swaps in that the interest rate payments on the two legs are in different currencies. At inception of the trade, the notional principal amounts in the two currencies are usually set to be fair given the spot exchange rate. Contrary to single currency swap, there is an exchange of principals at inception and maturity, or even in each period of the swap.

Cross currency swaps are powerful instruments to transfer assets or liabilities from one currency to another. The market charges for this is a liquidity premium – the cross-currency basis spread. Thus, the market quoted cross-currency basis spreads usually relative to a liquidity benchmark.

For a cross currency trade between one currency and another currency. If there is a higher demand for the currency, the party lending the dollar will ask for a premium. This premium is referred to as the cross currency basis. In general, the cross currency basis is a measure of the dollar shortage in the market. The more negative the basis is, the more severe the shortage.

Cross currency basis is an important element of currency management. To price a cross-currency product, the cross-currency basis spread has to be taken into account by adjusting either discounting or forecasting curves. For domestic currency investor, negative basis can work in their favor when they hedge currency exposures. For foreign investors, however, the basis can increase their hedging cost.

In January 2020, prior to the onset of the global coronavirus (COVID-19) pandemic, three of the seven largest economies by GDP had negative yields for two-year government bonds (Japan, Germany and France). With the onset of the pandemic, two-year bond yields in these countries actually rose slightly - in contrast to the other major economies, where yields fell over this period. As of December 2024, yields for two-year government bonds exhibited fluctuations across all countries. Notably, Japan showed a slight upward trend, while China experienced a modest decline.Negative yields assume that investors lack confidence in economic growth, meaning many investments (such as stocks) may lose value. Therefore, it is preferable to take a small loss on government debt that carries almost no risk to the investor, than risk a larger loss on other investments. As both the yen and euro are considered very safe assets, Japanese, German and French bonds were already being held by many investors prior to the pandemic as a hedge against economic downturn. Therefore, with the announcement of fiscal responses to the pandemic by many governments around March 2020, the value of these assets rose as confidence increased (slightly) that the worst case may be avoided. At the same time, yields on bonds with a higher return fell, as investors sought out investments with a higher return that were still considered safe.