TOKYO -- The Bank of Japan's surprise adjustment of its interest rate controls on Tuesday will have ripple effects for the economy and keep financial markets on edge over the possibility of another shock.
Market players were caught flat-footed by the BOJ's decision to raise the 10-year yield cap from 0.25% to 0.5%. The move was discussed in secrecy within the central bank. Gov. Haruhiko Kuroda and other top officials until recently talked down this possibility, saying widening the band would be a de facto rate hike.