The Bank of Japan’s (BoJ) recent shift in policy has sent ripples through global financial markets, creating uncertainty and prompting significant market reactions. On December 1st, 2025, Governor Ueda signaled a potential interest rate hike at a Nagoya event, dramatically altering market expectations for long-term monetary policy. This change has triggered adjustments across various asset classes, including Japanese government bonds and yen-denominated assets, as investors adapt to the new direction of BoJ’s strategy. Analysts believe this is a significant deviation from the bank’s historically low-rate approach aimed at combating deflationary pressures in Japan for years.