How Japanese policymakers ended up in a very deep hole

Investors betting on tighter monetary policy from the Bank of Japan (boj) have experienced very few victories over the past three or so decades of ultra-low interest rates. The first decision by the boj’s new governor, Ueda Kazuo, proved to be no exception. The central bank’s flagship policy of yield-curve control, which caps ten-year government-bond yields at 0.5% with aggressive bond-buying, was left unchanged on April 28th. Instead, the boj’s policymakers announced a review of their monetary policy. The exercise is expected to last a year, possibly longer.