It looks like the Bank of Japan's YCC ceiling on the 10-year yield will be raised to 1.5%:
- At least we know what the BOJ will do today: 10 year JGB yield to be permitted above +1%
- ICYMI: BOJ set to allow 10-yr Japanese government bond yields to rise above 1% ('sources')
- Bank of America expect the BOJ to allow the 10 year JGB yield ceiling to rise to 1.5%
JGB sellers jumping in ahead of that taking the yield to 0.955%.
The last time the BOJ expanded the ceiling they made the argument that doing so would mean they could maintain looser policy for longer.
USD/JPY over the past few minutes is higher, that argument the BOJ made last time might be coming front of mind ... also, the data we had today is not going to encourage the BOJ into tightening any time soon:
