ForeXistenZ › Central banks › BOJ
Bank of Japan (BOJ)
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For decades the anchor of near-zero rates — its every move shakes the yen carry trade.
How the BOJ moves the JPY
A central bank sets the interest rate on its currency. Traders compare that rate with the rates of other central banks; the wider the gap, the stronger the pull of money towards the higher-yielding currency. That is why the minutes before a BOJ decision are among the most volatile of the month for the JPY. Book I and Book II of the ForeXistenZ trilogy show how to prepare for these days — and when to stay out.
Frequently asked
What does the Bank of Japan do?
For decades the anchor of near-zero rates — its every move shakes the yen carry trade.
Where is the Bank of Japan?
The Bank of Japan (BOJ) is in Tokyo, Japan.
Why do forex traders watch the BOJ?
Interest rates are the price of a currency. When the BOJ raises or cuts rates — or only hints at it — money moves into or out of the JPY, and USD/JPY reacts within seconds.
Where are the BOJ’s decisions published?
Official decisions, statements and the meeting calendar are published on https://www.boj.or.jp/en.
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Other central banks
BOKBank of Korea
Seoul, South Korea — Sets rates for the won, one of Asia’s most traded currencies.
PBOCPeople's Bank of China
Beijing, China — Sets the daily reference rate of the yuan and is one of the world’s biggest buyers of gold.
HKMAHong Kong Monetary Authority
Hong Kong, Hong Kong SAR — Defends the Hong Kong dollar’s peg to the US dollar.
MASMonetary Authority of Singapore
Singapore, Singapore — Steers policy through the exchange rate itself, not an interest rate — a rare model.
BIBank Indonesia
Jakarta, Indonesia — Guards the rupiah for South-East Asia’s largest economy.
RBIReserve Bank of India
Mumbai, India — Manages the rupee for the world’s most populous nation.