Japan raises interest rates for the first time in 17 years

Interest rates have moved from -0.1% (Japan has had negative interest rates since 2016) to +0.1%. Here is the chart:

source

The crazy negative interest rate world (which the European Central Bank also participated in) is over. Good riddance to a dangerous experiment!

However, the so-called Carry Trade (where investors borrow at practically 0% and then invest in US and European bonds at 5%) will continue. The carry trade has been going on for about 25 years and is the main cause of asset inflation in the west.

It will only end when Japanese and Western interest rates converge. That is a long way off, but Japan has started to move in the right direction at last.