On July 31, the Bank of Japan raised its policy rate to around 0.25% from 0% to 0.1%, the first hike since Japan ended its negative interest rate policy in March.

The yen has risen about 8 per cent against the dollar over the past month and the reversal of the carry trade is leading to a massive global reckoning as expectations mount of a narrowing interest rate differential between the US and Japan.

Black Monday hit some financial markets around the world.