Japan’s Yield Trap: How BoJ Intervention Keeps the Yen Afloat

Robin J Brooks argues that Japan’s enormous public debt forces the Bank of Japan to continuously buy government bonds to cap long‑term yields; without this intervention, 30‑year yields could rise into the double digits, pressuring the yen and risking a debt crisis. He suggests debt reduction as the only sustainable fix and draws parallels with ECB actions that temporarily suppressed yields elsewhere, implying many advanced economies hide debt vulnerabilities under yield‑control regimes.