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Japan Faces Its Moment of Truth on Inflation

by Enochadmin

The Financial institution of Japan is preventing an more and more lonely battle. Up to now it has beat again speculators testing its resolve to maintain rates of interest low. However the market is betting {that a} plunging yen and rising inflation will finally power its capitulation.

Bets that the Japanese central financial institution would comply with its friends and lift charges this yr have fallen flat regardless of the more and more robust inflationary winds blowing. Futures on 10-year Japanese authorities bonds fell 1.4% final week however bounced again this week after the Financial institution of Japan purchased a file 9.24 trillion yen of presidency bonds final week, in line with CEIC. The central financial institution reiterated its so-called yield curve management coverage to cap 10-year bond yields at 0.25% eventually week’s coverage assembly.

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