It wasn't enough, however, and after an initial kneejerk move, the yen plunged while yields soared as the market concluded that what Ueda did was too little, too late, and the hike was too vague to press the hawkish case.

As such, the market doves are back in control, and forcing the BOJ to either double down and puts Japan's money where its mouth is, or lose control of either the currency or the bond market, or eventually, both.

In a recap of what the BOJ did, Bloomberg writes the following:

Ueda said risks tied to the impact of US tariffs appear to be easing and pointed to solid wage growth momentum next year year, a condition for more sustained inflation.

Both the BOJ statement and Ueda's remarks implied there's room to raise rates further, while offering assurance that conditions would remain accommodative. That reinforces expectations of a gradual and data-dependent tightening path.

Ueda also said the policy rate remains some distance from the lower-end of a neutral range and added he would like to recalculate that if the opportunity arises, signaling openness to further tightening but also a desire for greater confidence in the framework before moving more decisively.

As BBG notes, by lifting the policy rate to a three-decade high of 0.75% on Friday, Ueda continued his historic march toward restoring normality to Japan's monetary policy and the economy after decades of unconventional steps and underperformance. The only problem: Japan will never survive in a world where monetary policy is even remotely "normal " and as a result, government bond yields immediately climbed to the highest levels since the 1990s, an indication that the BOJ policy space is now narrower than ever. 

And indeed, Bloomberg admits that while Ueda had telegraphed Friday's move ahead of time, he didn't offer similar clarity about what comes next,  and that's left yen bears chomping on the currency instead of backing away. The yen slid more than 1% against the dollar, to around 157.40, in the hours after Ueda's press conference.

"Listening to what he said, I honestly couldn't tell at all when the next rate hike might be," said Teppei Ino, Tokyo head of global markets research at MUFG Bank. "He didn't really say anything about the neutral rate — there was simply no guidance at all."

Addressing the hawkish side, Goldman's Kai Wen Lim writes that the statement removed language that growth and inflation will stagnate due to tariffs, coupled with hawkish voices on the board and a clear acknowledgement that real rates are still low, all leaned on the more hawkish side despite a lack of new details. The reaffirmation bolstered bearish sentiment causing futures to sell off ~4bps while BOJ pricing also inched higher across the curve from March onwards, with June and July seeing the most traction implying market expectation of the next hike being ~6 months away.