TOKYO: The Bank of Japan raised interest rates on Friday in a widely expected move, reflecting its growing optimism that wages will continue rising and keep inflation sustainably around its 2% target.

The board decided to raise the BOJ’s short-term policy rate to 0.5% from 0.25% by an 8-1 vote.

Board member Toyoaki Nakamura dissented to the decision.

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BOJ Governor Kazuo Ueda is scheduled to hold a press conference at 3:30 p.m. (0630 GMT) to explain the policy decision.