Japan’s slow exit, in three charts

The Bank of Japan is not so much exiting as easing itself out the door, one basis point at a time. The pace is deliberate, and the JGB curve has learned to read it.

A curve that prices patience

The ten-year has printed fresh cycle highs without the disorder that earlier exits threatened, a sign the market has made peace with gradualism. The front end still anchors to a policy rate that moves slowly; the long end carries the burden of expectation.

What the curve is pricing, in short, is that the destination matters less than the speed. And the speed is glacial — by design.