MORNING BRIEFING: Euro zone FinMin meeting in Brussels today

[RTFX-Trading]

MORNING BRIEFING: Euro zone FinMin meeting in Brussels today

What’s new :
United States: FOMC Meeting Tuesday
Great Britain: Wednesday, publication of the Bank of England’s minutes
Euro area: Finance ministers from the euro zone meeting in Brussels
France: Greece did not need our help, according to Ms. Lagarde
Japan: Tuesday beginning of the Bank of Japan’s meeting
China: PM Wen said that the Yuan is not undervalued
Note debt: U.S. and Britain 'in the same basket'!

Today:


Rates in Asia and Indices:
EURUSD: 1.3776 - 1.3726.
USDCHF: 1.0609 - 1.0579.
EURUSD: 1.5199 - 1.5152.
EURJPY: 124.96 - 124.37.
USDJPY: 90.79 - 90.55.
DowJones: 10'624 .69 + 0.12%
NASDAQ: 2'367 .66 -0.03%
S & P 500: 1'149 .99 -0.02%
Nikkei: 10'751 .98 +0.01%
Shanghai: 2'976 .44 -1.23%
Gold: $ 1'104 .40
Crude Oil: $ 78.93
 
Comments:
The FOMC meeting on Tuesday in the United States will be the focus of the beginning of the week.  No changes in interest rate policy are expected from the Fed, the comments on the evolution of the United States economical health will be watched more closely.

Published on Wednesday, the minutes of the Bank of England should confirm the continuation of the central bank's policy of low interest rates, some even predicting new injections of liquidity in the second quarter of the year if the economy would remain sluggish.

No action is expected from today finance ministers of the 16 countries of the Euro Zone’s meeting in Brussels, although they hope to reach an agreement on how to support Greece in case it failed to refinance its debt. This meeting will be followed on Wednesday by a meeting of the Finances Ministers of the 27 countries of the European Union, in which the Greek debt will certainly be on top of the agenda.

At the same time, French Finance Minister Christine Lagarde said that Greece did not need help from other countries of the Euro Zone.

Also on the loaded program of meetings of the central banks this week, the one of the BoJ (Bank of Japan) will start Tuesday. With the political pressure on the central bank, rumours of further steps to relax monetary policies in the form of additional injections of liquidity where circulating in the market.

The demand of crude oil from China has increased significantly in January (+28%), increasing as well the demand for the US Dollar, while Prime Minister Wen said that the Yuan is not undervalued, reaffirming its commitment to keep the Chinese currency basically stable.

With debt reaching more than 7% of their income this year, and a probable significant increase for the period from 2011 to 2013, the United States and Great Britain are close to the fateful 10% that would make them loose their AAA rating according to rating agency Moody.

Good day

Pascal Bovay

RTFX Ltd
Trading desk
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