Economic data (US): CaseShiller Home Price Index YoY (FEB) out at 0.6% vs. 1.3% expected and -0.7% in JAN.
Economic data (US): CaseShiller Home Price Index YoY (FEB) out at 0.6% vs. 1.3% expected and -0.7% in JAN.
Trading commentary
27 April 2010
Yen weakness - a conundrum
Nick Beecroft, Senior Foreign Exchange Consultant
USD/JPY remains very highly correlated with the short-term yield differential between dollars and yen, and this may explain the yen’s recent slightly puzzling weakness.
With rumours abounding that the Chinese authorities are about to allow some strengthening of the Renminbi, one might have expected the yen to be displaying some sympathetic strength, (on the day of the last ‘step-change’ revaluation of the Renminbi, on 21st July 2005, the yen appreciated strongly from 112.90 to close at 110.26, although over the next six months it gave back those gains, and more), however, as the expectation of a Chinese move has grown over the last couple of weeks, the yen has weakened against the dollar, from 91.60 to around 94.00.
This despite Greece’s travails and the attendant strains upon the Euro, which might have been expected to promote the usual knee-jerk, safe-haven buying of yen.
Maybe the explanation lies in the market’s suspicions about the outcomes of two key central Bank meetings this week. In the States, the Fed’s FOMC meets on Tuesday and Wednesday, and the Bank of Japan announces the results of its monthly meeting on Friday.
With some slightly more encouraging economic releases in the US, and with Japan still mired in deflation, nervous dollar/ yen shorts are covering their positions in case the FED changes the all important phrase stating that rates are likely to stay, “…exceptionally low…for an extended period” and/or the BOJ is finally persuaded to increase Quantitative Easing measures to combat deflation.
A double-whammy of such moves would provide a serious boost to dollar/yen, given the market’s focus on the short-term interest differential.
In fact, I expect neither to happen. The FED is increasingly worried that deflation might hit America as the year progresses, as evidenced by the last FED minutes, and the BOJ seems set on its preferred course of complacent inaction until too late.
Or do we underestimate the BOJ? Maybe they’re keeping their powder dry specifically because they want some ammunition at their disposal to combat any yen strength which may follow a Chinese move?
Csokoltatom öket. Tegnapi gbpusd short követö stopját tickre kiszedték 10 körül.
Ez igy lefele forduló lesz gyertya szinten :-(
Meglátjuk, egyenlőre longok tartva
FX Closing Note: Risk treads water ahead of Goldman testimony, FOMC.
Risk eased off the gas in today's trading, as new highs in the US equity market were gently rejected and new recent highs in commodity currencies were likewise rejected.
Bulls of a more cautious stripe took some of their chips off the table in today's trade, with the Goldman hearings on tap tomorrow seeing Goldman shares and all shares in the financial services sector dragged sharply lower. Also possibly weighing on sentiment in banks and risk sentiment was discussion of plans by the US treasury to begin selling some of its billions of shares in Citigroup. The negative activity in bank equities is a likely reason for GBP finding some resistance in the US session to its earlier strength. Most currencies were relatively unchanged on the day, with directional attempts in Asia and Europe reverting to the starting point in the US session. One stand out on the strong side was NZD, where AUDNZD longs may be capitulating ahead of the RBNZ on Thursday (Wednesday late for most of us.)
FOMC pre-preview
In a market driven more by the idea of easy liquidity than strong fundamental improvements, the Wednesday Fed monetary policy statement is also a big focus, though after the endless dovish rhetoric and low inflation numbers, it's hard to imagine Bernanke and company making a sharp turn to the hawkish side just yet. Only if the mood within the Fed begins to shift and the committee begins to worry about the inflation of a new bubble in risk that is completely out of line with real improvements in the economy will they begin to alter their stance at present.
So far, there are no signs from within the Fed that a new bubble is becoming even a minor concern. The Fed is simply engaged in a slow process of slow withdrawal and a "let's see what happens" mentality. Can we really imagine the Fed coming up with something along the lines of "we stand ready to respond to the situation in the event the economy picks up more sharply than expected and/or if key asset market prices overrun their fundamental supports to such a degree as to endanger the strength of the recovery further out." This kind of statement is off the table, with perhaps a weak mention of "being ready to respond to stronger than expected inflation or economic strength if conditions merit". Any mention of asset market bubbles inflating is anathema.
This all means that the most plausible rout to a stronger dollar on improving interest rate spreads remains through more dovishness elsewhere relative to what is currently priced in, rather than through US yield expectations vaulting higher more quickly than the those for the rest of the world's major central banks. Thus, the greenback outlook largely remains hostage to global risk appetite, unless US fundamental data unexpectedly begins to sharply improve.
Hogy is van a közmondás? Jön még kutyára dér. Vagy valami ilyesmi.:) Csak akkor megint az egész 'Világ' szív velük együtt újfent.
a gbp erősödését nem nagyon tudom elképzelni a ft-al szemben. chf-et kicsit igen, ha így bénáznak továbbra is. USD erődödés háátt. Mindjárt felhívom a kinai haverokat...
:DD
Na jó éjt mindenkinek...
USD és GBP, CHF nem fog begyengülni, max tovább erősödik :)
akkor csak ft-ba kell fektetni dollár helyett... ez stabil pénz...
Én most a fonttal szemezgetek. Ha végre beesne vennék ft-ért gbp-t. Mondjuk 270 körül...
és a dollár is annyi lesz :)
sztm rútul be lesz verve eur....
Igen. Bár úgy gondolom, hogy az sp500 amennyire irreálisan magas, annyira alacsony az eurusd. Persze lehet a görög példára és a meghamisított statisztikai adatokra hivatkozni, de ha megpiszkálnánk az amerikai adatokat valszeg hasonló dolgokra bukkannánk.
Másik - nekem nehezen emészhető kérdés -, hogy a minősítő intézetek minősítgetnek kinti országokat.
Eljön majd az az idő is, amikor az amerikai állampapírokat is le fogják minősíteni?
Sohase láttam még, hogy például a citi-re azt írták volna, hogy egy vacak és csak szerkrény alátétnek jó ha az billeg a szobában...
Hát nem nagyon van olyan instrumentum ami érdemben mozog most estefelé...
:D
Nekem sem volt hosszú long.:) Zártam, mert nagyon erőtlen ez még.
Még nem jött el az ideje, de szólok ha megtettem, de a charton látni fogod:))
Na, na , te csak ne forogj nekem:))
várd meg amíg zárok:))