A “Dovish Hike” Out of the BoJ Prompts Renewed Slippage in the Yen

The BoJ surprised markets more with its guidance than with its rate hike.

Key Takeaways

• Japan’s Policy Rate is Now At a Thirty-Year High: The BoJ hiked rates by +25 basis points to 0.75% (widely expected), the highest since 1995, but weak guidance has triggered a slide in the yen. Global bond yields have ticked higher on the move, with the 10-year JGB yield touching 2.0% for the first time since 2006.