BOJ raises key interest rate, aims to curb yen's slide against dollar

The Bank of Japan raised its key interest rate Wednesday to about .25% from zero to about 0.1%, acting to curb the yen's slide against the U.S. dollar.

The move was widely expected, and the yen gained sharply against the dollar ahead of Wednesday's decision, trading at 152.75. But the dollar rebounded slightly after the decision, to 153.17 yen.

Share prices in Tokyo slipped 0.2% after the decision, to 38,463.18 after the decision.

The central bank has kept interest rates near or below zero for years, seeking to spur inflation in hopes that would sustain stronger growth for one of the world's largest economies.

That strategy has proven controversial. It did help to end a prolonged bout of deflation, or falling prices. But since wages failed to keep pace with price increases, consumers have tended to spend less rather than more.

Still, the bank said conditions warranted a change. A weak yen has pushed prices in Japan higher since it makes imported gas, oil and other necessities more