Central Banks
BOJ’s Policy Path Fraught With Risks After Global Market Turmoil
- Former financial and monetary officials offer insights
- Market volatility remains elevated even after losses pared
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Bank of Japan Governor Kazuo Ueda’s path to policy normalization got a lot rockier after market ructions this week, leaving him facing multiple risks ahead.
When he took the helm at the BOJ in April of 2023, Ueda inherited a complex monetary framework that seemed almost impossible to exit. After more than a decade of unconventional monetary easing, the bank held more than half of the market for Japan’s government bonds. And yet, after ending the world’s last negative interest rate in March, Ueda appeared to be moving smoothly toward normalization.