As expected the Bank of Japan decided to keep rates steady Friday with expectations suggesting this stance will continue for quiet some time. That said BoJ Governor Kazuo Ueda has announced it will be trimming it purchase of government bonds over the next two years, not enough of an excuse to see the Yen rally…
Euro initially tried to rally in response to another weak inflation metric from the US though the reaction proved to be short lived eventually giving up gains to see a big sell-off by the close. Our inability to hold gains following the Wednesday rally suggests a focus on the divergence between US and the Eurozone…
The British Pound was a big gainer on the knee-jerk response to weaker than expected US CPI. However the Fed was clear about its stance on the need for more data and market is speculating about a mere single rate cut for 2024 by the US should labor markets remain robust and inflation persistent. In…
Oil prices are looking interesting following the response to the FOMC and the earlier softness in US inflation. Essentially the charts are telling us a near term high backed by the idea of a longer tight monetary policy environment for the US. That said we are entering the US driving season when seasonal cycles dictate…
Gold initially spiked up following the release of slightly weaker than expected CPI data encouraging dollar bears and inflation watchers to call foe an easing. Eventually though Fed Chairman Jerome Powell in his press conference sighted the release as a single data point not necessarily signalling a shift in trends. Note that expectations are now…
The Japanese Yen is again losing ground against the dollar though overall performance has been mixed managing to hold its own with the Euro and slightly weaker with the British Pound. Focus for the day remains to be the FOMC decision later where expectations are for things to remain steady though key here will be…
With an FOMC rate decision and economic projects due Wednesday, traders will be closely looking on rate differential issues. Already the ECB has started its own easing cycle with last weaks 25bps cut though none committal on when the next move will be. On the other side speculations call for the Fed to reduce the…
Pounds attempt to takeout the floor of its nearly monthly long consolidation proved short lived with GBPUSD recouping its losses for the day in US trading. With an FOMC meeting tomorrow and a BoE rate decision on the 20th we are skeptical about prospects for any change in the equilibrium levels. Note however that Fed…
Oil saw a sharp rally Monday though we are unable to put a finger on the actual cause. Two things coming up for oil is today’s Monthly Report from OPEC which could clarify supply and demand expectations from the Cartel’s perspective. Meanwhile a clearer source of demand would be the upcoming US driving season which…
Already easing an hour before US Jobs data Friday, Gold may have defined a medium term high with the SHS break out from Friday as the premise for its move to historic levels may be over. Note that Gold has rallied from the 1600 levels in September 2022 largely as a hedge to inflation and…
