Japan shocks the public but maintains the status quo

Japan shocks the public but maintains the status quoBOJ has kept its ultra-soft interest rate but made bond yield controls more lenient. It is quite logical that the regulator has revised its average consumer inflation forecast for the current financial year upwards. But why did the markets react so strangely?BOJ said it would buy 10-year JGB at 1% every business day through fixed-rate transactions unless otherwise requested. The move effectively expands his target yield range by another 50 basis points. Market optimists are confident that the active actions of the regulator can increase the yield on 10-year bonds may rise to 0.7-0.8%.The political statement after the BOJ meeting has not been so tough and specific for a long time. Kazuo Ueda has been forced to tighten monetary policy as inflation consistently exceeds the 2% target for 15 consecutive months and wages are finally starting to rise after years of stagnation.However, BOJ believes that inflation will slow down by the end of this year: this opinion is shared by the Japanese government, but not supported by business representatives.Recall: Japanese investors are the largest foreign holders of US government debt, and also own a significant number of European and Australian bonds. Some investors are worried that higher domestic returns will force Japanese hedge funds to sell overseas assets and bring that money home.Incidentally, the yield on 10-year bonds in Australia has already risen by 18 basis points, and in New Zealand - by 9 basis points.Even a hint of BOJ policy easing provokes an influx of Japanese investment into the US markets and temporarily compensates for the loss of liquidity due to the Fed's actions. But such a trend could significantly reduce interest in the yen carry trades.Let's see what happens.Profits to yall!#ForexChief #BOJ #KazuoUeda #forexnews #stocks #worldnews #Market