The fire on the other side of the river

Japan’s policymakers have said that the euro-zone crisis is not a fire on the other side of the river – the implication being that Japan will not be able to escape indefinitely the debt problems that have engulfed the euro-zone. However, for now at least JGBs are still regarded as a safe haven and yields are falling. In this Weekly we re-visit the arguments why Japan is different from the euro-zone, but also why this safe haven status cannot be taken for granted.