Japan

Ever since the USDJPY breached the 110 support level three days ago for the first time in 17 months, the pressure on this all important FX carry cross has been rising, and then overnight, following the latest bout of recurring and increasingly ignored jawboning by various Japanese officials, the Yen soared, with the USDJPY plunging first below 109 and then moments ago dropping as low as 108.02 before rebounding modestly, dragging US equity futures lower with it.

Update: literally seconds ago, when the USDJPY tumbled below 110, we asked "how much longer will Kuroda sustain this battering before Japan is forced to do something even more ridiculous" and we may have gotten the answer when minutes after the USDJPY dipped below 110, some unknown "buying force" emerged out of nowhere and pushed the pair right back up over the critical support level.

Is the BOJ telegraphing that "you shall not pass" the 110 support?

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US military bases that are stationed in Japan will not be relocated “within the foreseeable future” since the island country still needs security backing from the United States,  the Japanese Prime Minister Shizo Abe has claimed In an interview with the WSJ, published on Tuesday, Abe said: “I cannot conceive of any situation within the foreseeable future when the US presence wouldn’t be necessary” RT reports: The statement came in response to a question on the possibility of the withdrawal of American troops from Japan – a move recently proposed by Republican presidential front-runner Donal

Submitted by Wolf Richter via WolfStreet.com,

“Negative interest expense” or some such absurdity yet to be coined.

“For now, the effect of negative interest rates is very strong, so we’d like to steadily proceed with this policy,” Bank of Japan Governor Haruhiko Kuroda told parliament today, to reassure the nervous politicians that the economy was on the right track under his fearless and wise leadership.

Back in the summer of 2014, when the ECB first unveiled NIRP, many were concerned that this submersion into the monetary policy twilight zone would first crush Europe's money markets. However, at least until now, European MM funds have proven relatively resilient,

The story in Japan is different.

When the Bank of Japan announced they were instituting NIRP back in January, they intended to spur lending and push inflation up. As often is the case with central planners, their academic theory was much different than the economic reality.