Tokyo raised rates to a 31-year high. The currency fell anyway. Japan is finding out, in real time, that you can defend the yen, protect the debt, or keep the politicians happy — not all three.
ZTrader Research · Macro / Currencies THE YEN TRILEMMA Tokyo raised rates to a 31-year high. The currency fell anyway. Japan is finding out, in real time, that you can defend the yen, protect the debt, or keep the politicians happy — not all three. By Dorian ZTrader Research · June 22, 2026 I. The Empty Seat On the morning of June 16, nine chairs sat around the policy table on the ninth floor of the Bank of Japan's headquarters in Nihonbashi, and one of them was empty. Kazuo Ueda, the central bank's governor, was across town in a hospital bed, recovering from treatment for an infected liver cyst. He had chaired every rate decision since taking office in 2023. This was the first one he would miss — not by resignation, not by scandal, but by a body that picked the worst possible week to fail him. Deputy Governor Ryozo Himino took the chair instead. Seven votes went his way; one board member, Toichiro Asada, dissented, arguing that the war-driven energy shock posed more danger to factories and paychecks than to prices. The board raised the policy rate a quarter point, to 1.00 percent — the highest it has stood since September 1995, three decades and ten months ago. Wire services calle
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