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Japan spent decades as the world’s best destination for the world’s easiest funding trade. You could borrow yen at very low rates, buy almost anything with a higher yield, hedge just enough to feel responsible, and assume the Bank of Japan would keep volatility contained.
Late January 2026 is what it looks like when that assumption starts to break.
The BOJ’s Jan. 23 decision kept its policy rate guidance around 0.75%. However, the BOJ also made it clear it still sees a path where further hikes remain…
