Overview
- The Bank of Japan raised its policy rate by 25 basis points to 0.75%, the highest since the mid-1990s, and signaled it could tighten further.
- Japan’s 10-year government bond yield topped 2% for the first time since 2006 as the yen weakened to roughly 156–157 per dollar and the Nikkei closed about 1% higher.
- U.S. consumer inflation slowed to about 2.7% year over year in November, with economists and Fed officials warning the reading was likely distorted by the recent government shutdown.
- Market pricing now assigns only about a 20%–30% chance of a January Fed cut, with easing pushed further out on swaps while Treasury 10-year yields hover near 4.13%.
- Global equities advanced, led by Asia, as strong Micron earnings buoyed tech shares and helped Wall Street rebound, with the Nasdaq posting fresh gains after Thursday’s rally.