JGB's/Bowman/Gold/Cannabis/Renter Nation/Other

JGB yields are moving higher after an FT article today titled "BoJ signals readiness to exit negative rates." The first sentence of the piece, "Officials at the Bank of Japan have become increasingly confident that the economy is robust enough to attempt an imminent exit from the world's remaining negative interest rates." It seems like we're getting real close here and March could be the month, though at the last BoJ meeting the hints were there and it's maybe why the yen is not really moving. Yields are up notably across Asia, that spilled over into Europe and why US yields are up too again (as well as reasons below). The US 2 yr by the way is up 23 bps in two days to the highest since January 19th. 

While just about all Fed members were citing higher long term interest rates last summer as further tightening policy for them, only Governor Michelle Bowman is talking about the easing of financial conditions and also geopolitics and how it could impact their policy. Back on January 9th, Bowman said "There is also the risk that the recent easing in financial conditions encourages a reaccelerating of growth, stalling the progress in lowering inflation, or even causing inflation to reaccelerate." 

Late Friday, she talked about the upside risks to inflation, including similar wording as above. "These include risks from geopolitical conditions, including the prominent risk of spillovers from geopolitical conflicts and the extent to which food and energy markets and supply chains remain exposed to these influences. There is also the risk that continued easing in financial conditions could add momentum to demand, stalling any further progress in lowering inflation, or even causing inflation to reaccelerate." She also mentioned the "continued labor market tightness."

Her conclusion, "I will remain cautious in my approach to considering future changes in the stance of policy. Reducing our policy rate too soon could result in requiring further future policy rate increases to return inflation to 2% in the longer run." And she also threatened another rate hike if needed to restore price stability.

Now Jay Powell said nothing new last night on 60 Minutes that he didn't say last Wednesday but I had to laugh when interviewer Scott Pelley was introducing the interview by saying "inflation has plummeted" as if people are experiencing a drop in the price of things and then went on to ask Powell, "Is inflation dead?" Anyway, Powell repeated that March is basically off the table and maybe by mid year they will cut rates which he seemed intent on doing this year at some point. Similar to the press conference, Powell again said nothing specific about easing financial conditions and the Red Sea situation and how it could influence policy but waiting to be more  confident of the sustainability of the disinflation being seen could be his implicit acknowledgement of the risks to the upside in inflation, though its obviously moderated.