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Robin Brooks questions how high Japan's long-term yields would be without ongoing bond purchases from the Bank of Japan, suggesting that a conservative estimate puts the difference at 300 basis points.
He argues that this persistent intervention is the primary reason for the continued depreciation of the yen, as Japanese long-term yields remain artificially low.
Brooks has recently noted that Japan's major currency interventions have failed to strengthen the yen, with the currency now weaker than in 2024 despite efforts by authorities. In earlier commentary, he highlighted persistent yen weakness following intervention. Brooks has also commented on other market mispricings, such as when oil prices returned to pre-war levels while markets failed to adjust.