The end of Japanese yield curve control is a fascinating tale.

What happened: The Japanese central bank has announced the end of yield curve control, the mechanism by which they buy sovereign bonds to 1) provide liquidity to the economy and 2) maintain low yields. While they have maintained the flexibility to intervene in case markets become too volatile, this is a major diversion from their decades long policy.

What's going to happen next: This will be fascinating to watch because there are multiple opposing forces at play:

- Higher yields should technically bring more Japanese money back from foreign bond markets to the domestic market. Usually this should result in an increase in the YEN vs. USD/EUR

- The initial reaction however, was in the opposite direction: the YEN is declining. The reason for this is likely because investors about the valuation of Japanese assets once they are no longer propped up by unlimited cash from the Japanese central bank.

- As money flows back into Japanese bonds, this should put pressure on US government bond prices which have been a main beneficiary of Japanese (and other foreign) money seeking yield.

The implications will be profound! Watch this space.