The conflict in the Middle East pushed up oil prices. The Bank of Japan kept interest rates unchanged at 0.75% in March, casting doubt on the prospect of raising interest rates in April. The risk of stagflation in Japan has increased, and the Japanese yen has become the core financing currency for global arbitrage. The strategy of borrowing the Japanese yen to buy the currencies of energy exporting countries has returned more than 6% during the year. We need to be alert to the risk of violent appreciation of the yen triggered by the escalation of conflicts, and pay attention to the three major variables of the central bank's rhetoric, oil prices, and wages.