Despite rising inflation, there is still a need for accommodative policy to ensure that price growth remains sustainable over the medium-term. Over the past year, market participants have waited impatiently for the Bank of Japan (BoJ) to raise rates while justification remained scant. Governor Kazuo Ueda recently iterated that the BoJ did not expect their stance to change unless ‘underlying’ inflation picked up. Yet the BoJ then widened the corridor for the 10-year yield. How do we align these views and actions? CPI inflation ex. fresh food and energy, one of the BoJ's preferred price gauges, is currently just above ... (full story)