, Columnists
Traders Are Out of Step With the Bank of Japan’s Ueda
Expectations for how quickly the central bank governor will tighten seem detached from reality.
The markets must listen more carefully to Ueda.
Photographer: Kiyoshi Ota/BloombergThis article is for subscribers only.
The markets are falling out of step with the Bank of Japan. It’s becoming a familiar sight: Expectations rise that the BOJ will take bold hawkish steps. The reality is milder, and disappoints. The yen weakens yet further.
This predictable loop was on display last week, when traders talked themselves into thinking that the BOJ would begin quantitative tightening. When Governor Kazuo Ueda announced merely that it would detail the specifics next month, the hawks were disappointed again.