The yen slid to an all-time low against the euro and the Nikkei 225 stock index surged to a near-seven-year high on Thursday as markets bet that Japan’s central bank would not raise interest rates again until much later this year.

The market reaction, which also included a rise in bond prices, was greeted with relief inside the Bank of Japan following its decision to double interest rates on Wednesday to 0.5 per cent.