The ECB warning on bond market impacts of BOJ policy change is getting a rerun in Asia

On Wednesday the European Central Bank European Central Bank The European Central Bank (ECB) represents the central banking entity in the Eurozone that oversees monetary policy for the bloc. As a growing geographic and economic region, the eurozone now includes 19 countries, which rely on the euro as their national currency.The eurozone presently consists of Austria, Belgium, Cyprus, Estonia, Finland, France, Germany, Greece, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, the Netherlands, Portugal, Slovakia, Slovenia, and Spain.In terms of monetary The European Central Bank (ECB) represents the central banking entity in the Eurozone that oversees monetary policy for the bloc. As a growing geographic and economic region, the eurozone now includes 19 countries, which rely on the euro as their national currency.The eurozone presently consists of Austria, Belgium, Cyprus, Estonia, Finland, France, Germany, Greece, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, the Netherlands, Portugal, Slovakia, Slovenia, and Spain.In terms of monetary Read this Term released its quarterly Financial Stability Review.

In it the Bank warned that policy normalisation by the Bank of Japan could test the resilience of global bond markets.

• "Inflation Inflation Inflation is defined as a quantitative measure of the rate in which the average price level of goods and services in an economy or country increases over a period of time. It is the rise in the general level of prices where a given currency effectively buys less than it did in prior periods.In terms of assessing the strength or currencies, and by extension foreign exchange, inflation or measures of it are extremely influential. Inflation stems from the overall creation of money. This money is m Inflation is defined as a quantitative measure of the rate in which the average price level of goods and services in an economy or country increases over a period of time. It is the rise in the general level of prices where a given currency effectively buys less than it did in prior periods.In terms of assessing the strength or currencies, and by extension foreign exchange, inflation or measures of it are extremely influential. Inflation stems from the overall creation of money. This money is m Read this Term in Japan has been increasing over the past year, leading market participants to expect the Bank of Japan to start normalising its monetary policy,"
• If Japan normalises policy, this could rechannel investments by Japanese investors who have a large footprint in global financial markets, the ECB warned. "A rapid decline in rate differentials and increased exchange rate volatility could reduce the attractiveness of their carry trades,"
• "A shift away from the low interest rate environment in Japan could test the resilience of global bond markets,"
• added that higher rates at home could lead to a repatriation of vast sums held by Japanese investors overseas.

Its unusual for the ECB to make such pointed remarks about another major central bank.

Reuters had this overnight for more.

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Anyway, Bloomberg is posting a report on the ECB comments.

Huh ... is this body language instructive?