The Bank of Japan's inflation gauge reached a seven-month peak.

• In November, the "core-core" inflation rate, excluding food and energy prices, reached 2.4% from 2.3% in October, marking its highest level since April.
• The core inflation rate for November was 2.7%, higher than the 2.3% recorded in October and exceeding the 2.6% forecast by Reuters polled economists.

The Bank of Japan (BOJ) closely monitors an inflation gauge in Japan, which reached a seven-month high in November. This could prompt the central bank to raise rates early next year.

The BOJ's "core-core" inflation rate, which excludes fresh food and energy prices, increased to 2.4% from 2.3%, reaching its highest level since April.

The inflation rate, excluding food prices, was 2.7% in November, higher than the 2.3% recorded in October and above the 2.6% predicted by economists surveyed by Reuters.

Inflation increased to 2.9% from 2.3%, marking its highest point since August.

The Bank of Japan kept interest rates at 0.25% despite economists predicting a 25 basis points increase.

The BOJ announced on Thursday that its decision to hold was made by a 8-1 vote, with board member Naoki Tamura pushing for a 25-basis-point increase.

During the meeting, Tamura believed that inflation risks were more likely to increase, so he suggested raising interest rates.

According to a report, BOJ Governor Kazuo Ueda stated in a press conference on Thursday that since underlying inflation was only rising at a "moderate pace," the BOJ could proceed with raising rates at a slower pace.

Ueda stated that the central bank was aware that if it delayed raising rates, it would eventually have to increase them rapidly in future meetings.

Before long, the BOJ will resume its tightening cycle, according to Marcel Thieliant, head of Asia-Pacific at Capital Economics. Capital Economics anticipates a hike in January following the release of new economic forecasts.

Tamura voted to raise rates to 0.5%, which was not a unanimous decision.