The yen extended its decline against the dollar after the Bank of Japan raised interest rates as expected, with two dissents casting doubt on further tightening. Japan’s currency fell as much as 0.7% to 157.09 per greenback, while Japanese government bonds erased earlier gains. While the move was predicted by all economists surveyed by Bloomberg, the vote was 7-2 as board members Toichiro Asada and Ayano Sato dissented.

The decision reflects internal division within the BOJ over the pace of policy normalization despite broader market expectations for a hike. The yen’s drop underscores skepticism about the sustainability of Japan’s shift away from ultra-loose monetary policy, even as inflation pressures persist. Market participants are now watching for signals on whether the dissenting views will influence future policy direction.