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BoJ widow maker: Are investors shorting Japanese government bonds again?
It is often said that betting against the Bank of Japan (BoJ) is a "widow maker" trade. But hedge funds and other investors, mostly in Europe and the US, now appear to be challenging the BoJ by selling Japanese government bonds (JGBs). Are there more widows to be made by adopting this approach? Take the current market environment as an example: The BoJ has remained steadfastly behind its loose monetary policy for decades – even as many central banks began raising interest rates to tackle the post-pandemic global inflationary surge. Then in the past few weeks, a number of policy officials began to voice concerns ... (full story)