The Bank of Japan raised interest rates, but the policy path remains unclear. The yield on 10-year Japanese government bonds rose above 2%, and the yen weakened.

The yield on Japan's 10-year government bond has climbed to its highest level since 1999, while the yen has weakened. Despite the widely expected announcement of a rate hike by the Bank of Japan, uncertainty still exists regarding the policy path. The Bank of Japan's 25 basis point rate hike to 0.75% is in line with economists' expectations, but traders are disappointed by the lack of clear guidance on when the central bank may tighten monetary policy again. The USD/JPY has expanded its gains to 0.9%, reaching 156.89, its highest level since December 10th. The yield on Japan's 10-year bond has surpassed 2%, marking an important milestone in the normalization process of the Japanese financial market. Currently, this yield is higher than that of China's equivalent term, but still about half of the US yield.