BOJ the week's Big Kahuna

We're back in business after a three-day weekend for the U.S. markets (and boy am I ever swamped!) The big event of the week has to be the Bank of Japan's interest rate policy meeting. The two-day meeting, currently underway, is a toss-up -- some expect policymakers to implement a 25 basis point hike. That would bring Japanese short-term rates to 0.5%. Others think the BOJ will bow to political pressure and stay on the sidelines. The last meeting on January 18 resulted in a 6-3 vote to keep rates unchanged.

Why does this matter so much? It all goes back to the yen carry trade. If Japan gets serious about hiking interest rates, it could have vast implications for global asset prices. See this post for more background on the stakes.