Did the BoJ intervene because the new de facto pain threshold is 0.6%? Or was the rise in yields too rapid for the BoJ?

We can only hope that with time we will learn from experience how the BoJ operates. In that case, we could ‘only’ reproach the BoJ for those interventions and the market volatility that would have been unnecessary had the BoJ communicated its policy clearly. However, I fear that by that point the BoJ officials will have new ideas and the whole game will start all over again.

Amidst this chaos, the Yen will sometimes trade weaker and sometimes stronger. Of course, it is completely impossible to predict the timing of these moves, but it can be said that overall, the JPY will be trading weaker than in a scenario in which the BoJ would act in a reliable manner. A central bank that is afraid of deflation (despite core inflation rates of 4.2%) might like that. But long-term a weaker Yen means that Japan is getting poorer.