- Will discuss letting long-term rates rise above 0.50% limit “by a certain degree”
- Under the more flexible policy being considered, the BOJ would permit gradual increases above the 0.5% threshold, but still clamp down on any sudden spike
- The proposed change would keep the rate ceiling, but allow for moderate rises beyond that level.
- The report highlights positive effects on inflation from a stronger yen
- Full report from Nikkei
The yen rallying hard on this (ie USD/JPY falling). The report cites a BOJ survey of Japanese banks that says they expect 0.5% 10-year yields if YCC dropped but I think that’s optimistic given inflation rates in Japan.
To me, this sounds like a plain-old dropping of YCC with some caveats to stop spikes. Today’s meeting just got a whole lot more interesting.
USD/JPY 10 mins