Japan's central bank has raised its key interest rate to about 0.5% from 0.25%, noting that inflation is holding at a desirable target level.

The Bank of Japan raised its key policy rate to the highest level since 2008 and took a more bullish view on the strength of inflation.

In the eyes of Japanese economic policymakers, there have been few surprises from the nearly week-old Trump administration. That, in part, gave them confidence to raise interest rates again Friday. Why it matters: The Bank of Japan had held off hiking rates late last year,