The Bank of Japan raised its policy rate from 1% to 1.25%, the highest level since April 1995, in a 7-2 decision that marked the shortest interval between increases since 1990. The move came three months after the previous increase in June and accelerated the BOJ's exit from ultra-low interest rates. Governor Kazuo Ueda said underlying inflation is approaching the 2% target, shifting policy from lifting inflation toward preventing a sustained overshoot. He ruled out a preset tightening schedule and said each meeting would assess incoming data, while warning that larger or consecutive increases could not be excluded. Toichiro Asada and Ayano Sato dissented, arguing that economic and price conditions did not yet justify a hike. August core CPI rose 1.7% year-on-year, while corporate goods prices increased 7.6%, with energy costs, yen weakness and labor-market tightness adding to inflation pressure. The yen weakened past 157 per dollar, 10-year Japanese government bond yields fell and the Nikkei 225 gained about 1.4% as markets judged the decision insufficiently hawkish to confirm a rapid series of increases.