Just went well. On the day after the Japanese central bank’s surprising turnaround, the financial markets calmed down again. What happened in Japan is quite historical.
The head of the central bank, Haruhiko Kuroda, who is to leave in April, has initiated the departure from decades of negative interest rate policy. Although Kuroda kept the key interest rate at minus 0.1 percent, the Bank of Japan (BoJ) is allowing higher yields on the bond market it controls.
The yield on ten-year Japanese bonds is now allowed to fluctuate within a range of plus 0.5 percent to minus 0.5 percent, twice as much as before. This initially caused a historically significant increase in yields on ten-year Japanese bonds from 0.25 to up to 0.46 percent. The decisive factor is that with its move, the BoJ has shown that it is no longer immune to the global trend towards tighter monetary policy.
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