CNBC Pro asked top Wall Street strategists and money managers how investors should position their portfolios as the Japan 10-year bond yield goes negative.
Yields on Japan's benchmark 10-year government bond fell below zero for the first time, as investors clamored for safe-haven assets.
Japan's banks will likely bear the brunt of the Bank of Japan's negative interest rates move, but analysts are divided on how badly they'll be hit.
Policymakers at the Bank of Japan tussled over the decision to adopt negative interest rates, according to the summary released Monday.
The latest data showing weak private sector credit flows in the euro area suggest that might well be the case.
Nandini Ramakrishnan, global market strategist at JPMAM, says it will be difficult for central banks worldwide to hit inflation targets.
Japan is teetering on the brink of a negative yield on its benchmark 10-year bond, but analysts aren't necessarily worried.
Freya Beamish, economist at Lombard Street Research, says the Bank of Japan is uncomfortable with the yen's status as a safe-haven asset in markets.
Bank of Japan Governor Haruhiko Kuroda said the central bank can expand asset purchases further or cut rates deeper into negative territory if needed.
Bank of Japan policymakers agreed in December that the broad price trend was improving steadily, minutes of their rate review showed.
Derek Halpenny, European head of global markets research at Bank of Tokyo-Mitsubishi, discusses the Bank of Japan’s recent decision to cut interest rates into negative territory.
Simon Male, head of Asian equities at Auerbach Grayson, says weak demand for credit is a problem for Asia.
Monetary policy in the U.S. will be tighter even if the Fed does not raise interest rates this year, Art Cashin of UBS says.
Annette Beacher from TD Securities, says that the dollar/yen rally will fade because the actual practicality of the BOJ's negative rates policy is minimal.
Chris Konstantinos from RiverFront Investment Group says the more a central bank can shock and awe markets, the more powerful their stimulus can potentially be.
Wayne Gordon from UBS Wealth Management, says the BOJ governor Haruhiko Kuroda played the markets well for the past few months.
BOJ's Friday decision underlines its commitment to reach its 2 percent inflation targets and the limitations of its policy toolkit, says Omar Slim from PineBridge Investments.
Tai Hui from JPMorgan Asset Management, says the Fed is moving against the grain of global central banks who are asing monetary policy.
The BOJ move last Friday signals that policymakers want to keep the yen weak to support reflation, says Tai Hui, chief Asia market strategist at JPMorgan Asset Management.
The BOJ meant to surprise markets as the weaker yen is crucial to the success of Abenomics, explains Ursina Kubli, economist and FX strategist at Bank J. Safra Sarasin.