The Bank of Japan ended nearly six years of rock-bottom interest rates Friday, abandoning its "zero-interest-rate policy" and hiking the unsecured overnight call rate to 0.25 percent on the strength of Japan's steadily improving economy.
Indicating victory in the central bank's prolonged battle with deflation, the nine-member BOJ Policy Board decided in a unanimous vote to discard the policy after BOJ Gov. Toshihiko Fukui proposed it at the end of the two-day meeting.
The central bank also voted 6-3 to raise the official discount rate from 0.1 percent to 0.4 percent. That will be applied to the BOJ's Lombard-style lending facility, which allows financial institutions to borrow funds from the central bank with collateral.