MORNING BRIEFING: Pressure mounts on BOJ to loosen monetary policy; falls to 2 week low against the Euro.

[RTFX-Trading]

MORNING BRIEFING: Pressure mounts on BOJ to loosen monetary policy; falls to 2 week low against the Euro.

What’s new:
China: Central Bank’s Su tells Obama, ‘Don’t politicize Yuan’.
Japan: Mounting pressure on BOJ to loosen monetary policy.
Switzerland: SNB leaves rates unchanged; say will act ‘decisively’ to combat excessive strength in CHF.
United States: US Dollar subdued ahead of Advanced Retail Sales.
United States: Summers says US is “very close” to job growth.
United States: Obama plans to nominate Yellen for Fed vice chair.

Today:


Overnight Rates and Indices:
EURUSD: 1.3724– 1.3669.
USDCHF: 1.0697 – 1.0643.
GBPUSD: 1.5120 – 1.5027.
EURJPY: 124.29 – 123.70.
USDJPY: 90.75 – 90.48.
DowJones: 10’612 +0.42%
NASDAQ: 2’368 +0.40%
S&P 500: 1’150 +0.40%
Nikkei: 10’751 +0.81%.
Shanghai: 3’013 -1.24%,
Gold: $1’113
Crude Oil: $82.26
 
Comments:

The yen fell on Friday morning, dented by speculation that the Bank of Japan could further loosen its monetary policy in next week’s meeting, while the US Dollar was quiet ahead of key US Advanced retail sales data today at 1430 CET.

The yen dropped to a two-week low against the Euro to 124.24 and was up to 90.74 against the Dollar as investors increasingly expect the Japanese central bank to further ease monetary policy at its meeting on March 16-17.

Government is putting increasing pressure on the BOJ for further easing, to support Japan's fragile economic recovery, with Finance Minister Naoto Kan saying on Friday he hopes the BOJ will help beat deflation.

China’s deputy central bank governor Su Ning told President Obama not to make a political issue out of the Yuan. She restated Beijing’s long standing stance that a stronger Yuan, would not reduce the country’s excessive trade surplus.

US retail sales, today at 1430 CET are expected to be weaker than in January, which could hurt prospects for a durable economic recovery. The Euro is up to 1.3718 versus the Dollar early today ahead of the key figure. Yesterday, the SNB left rates unchanged, however the Swiss franc fell after the SNB said it would act ‘decisively’ to combat an excessive rise in the Swiss currency.

Good Weekend.

Emman Xuereb
Trading Desk
RTFX Ltd
Risk Disclaimer