BOJ Brings Change of Philosophy to Monetary Policy

The transcript discusses the Bank of Japan's shift from quantitative to price targeting, which affects the yen's strength and reduces the push towards riskier assets. It explores the impact of these changes on FX volatility and yield curves in Japan, Europe, and the US. The discussion highlights the BOJ's influence on other central banks and the limited effect on inflation expectations. The BOJ's flexible approach to tapering is seen as a solution to ongoing challenges, with implications for the Federal Reserve's future actions.

In what ways could the ECB be influenced by the BOJ's monetary policy changes?

Discuss the relationship between FX volatility and the Bank of Japan's balance of payments.