Ella 
196
The renewed weakness in the yen first reflected uncertainty about how the Bank of Japan intends to control yields in the future. Also, there is a very trivial reason: high yields make JGBs attractive only assuming they don’t rise further.
For now, it looks likely that December’s cap adjustment and Friday’s vague wording will be two steps in a painfully slow process that will eventually lead to a sharp rise in yields. Perhaps, this is even the beginning of the end of yield curve control. Until then, global investors may want to steer clear of JGBs. In my opinion, this is one of the reasons for the current yen weakness.
