Bank of Japan to hike rates to 1.25%?

The Bank of Japan is expected to raise its policy rate to 1.25% at next week's meeting, according to market expectations. The move would mark another step away from years of ultra-low interest rates. Japan's central bank has been slowly tightening policy as inflation holds above its 2% target. A rate hike would raise borrowing costs for households and businesses. It could also strengthen the yen, which has weakened sharply against the dollar this year. The Bank of Japan has not confirmed the decision. The final call will come at the end of its two-day policy meeting next week.