Even a modest tweak to the Bank of Japan’s entrenched monetary policy could set a wrecking ball in motion through worldwide markets, if traders project the last heavyweight anchor stopping global yields from rocketing further is finally shifting.
Most economists expect Gov. Haruhiko Kuroda to stick with yield-curve control, until he steps down in April, even as the yen slides. But there’s no denying his policy framework has been under more pressure this year than it ever has since its formation in 2016.
If the BOJ decides to shock investors and finally tighten policy, they face the turmoil inflicted on global markets by the United Kingdom’s recently abandoned economic plan — just on a larger scale.