Last week, the Bank of Japan unanimously voted to raise interest rates, increasing the benchmark interest rate from 0.5% to 0.75%, reaching a 30-year high. At the same time, the Fed and the Bank of England each cut rates by 25 basis points, while the European Central Bank stood pat. This situation is interesting—the global monetary policy is "playing their own tunes," and the divergence between tightening and loosening is becoming increasingly apparent.

This round of interest rate hikes is not without reason. In Japan, the core CPI has been maintained above 2% for more than 40 consecutive months, the depreciation of the yen has raised imported inflation, and coupled with the acceleration of wage growth, an inflation cycle has already formed, leaving the central bank with little room for maneuver. However, the market had already anticipated this step, and the scale of carry trades has shrunk compared to last year, so the short-term impact has been less severe, which also explains why we can see a phase rebound recently.

But this does not mean that the risks have disappeared. The key is that the divergence in the policy direction between the Fed and Japan will trigger a reshuffling of global funds. Capital will definitely flow along with the yields, and the differentiation in policies itself is the core fuel for market volatility. Those investors chasing the rebound need to ask themselves: Is this a trend reversal signal, or the last window for reducing positions before shorting? No one can answer this question directly; it depends on how you interpret the policies and how you allocate your assets.