Bank of Japan. The Bank of Japan (BoJ) tweaked its yield curve control policy (YCC) at a meeting ending this morning by redefining the 10-year rate cap as a reference rather than a rigid bound and thus also removed a pledge to defend this level with offers to buy an unlimited amount of bonds at the 1% level. A story indicating a tweak of the YCC moved USD/JPY from 149.7 to 149.0 levels already yesterday. This morning, markets sold the fact again on announcement and traded the cross back to 150. JGB yields have sold off and 10-year yields now trade 5bps closer to the rate cap at 95 bps. As we see it, this was another, likely the last, step ahead of dismantling the YCC altogether. However, the BoJ still needs confirmation that inflation has sustainably moved above the 2% target before they are ready to take bigger steps to normalisation. They are slowly recognising higher inflation is not temporary and moved their inflation forecast significantly higher, particularly for the fiscal year