Analysis and Recommendation: The USD/JPY soared 43 points as the US dollar gained a bit while traders were disappointing with the Current Account figures
The USD/JPY soared 43 points as the US dollar gained a bit while traders were disappointing with the Current Account figures released this morning sending the yen on a decline. The pair is trading at 117.32. The yen has outperformed other major currencies this week, surging 3.6 percent versus the dollar, the most since July 2009. It was little changed at 116.74 per dollar as of 6:45 a.m. in London. It was as weak as 121.69 on Jan. 29 after the BOJ policy decision. Japan’s benchmark 10-year bond yield continued to decline this week, touching a record-low 0.025 percent Friday.
Blindsiding global financial markets on January 29, the BOJ adopted negative interest rates for the first time ever, buckling under pressure to revive growth in the world’s third-largest economy. It was a close call, with five members voting for negative interest rates and four against the surprise move.
“I am concerned that the Bank’s introduction of a negative interest rate could lead to a competition with central banks in other countries, which already have adopted negative interest rates, to lower interest rates deeper into negative territory,” one member said, according to the summary of opinions at the monetary policy meeting.
Members submit a summary of their opinions to BOJ Governor Haruhiko Kuroda, who edits them before their public release. Individual members are not identified in the release.
Japan’s current account surplus shrank in December to its lowest level in six months. In the final month of the year, Japan registered a current account surplus of Y960.7bn ($8.21bn) unadjusted, down from Y1.144tn in November, and also below forecasts for Y1.590tn.
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Today’s economic releases:
Upcoming Economic Events that you should be monitoring:
Tuesday, February 9, 2016
Cur. | Event | Actual | Forecast | Previous | |||
China – Lunar New Year | |||||||
AUD | HIA New Home Sales (MoM) (Dec) | -2.7% | |||||
GBP | BRC Retail Sales Monitor (YoY) (Jan) | 0.4% | 0.1% | ||||
AUD | NAB Business Confidence (Jan) | 3 | |||||
EUR | German Industrial Production (MoM) | 0.4% | -0.3% | ||||
EUR | German Trade Balance (Dec) | 20.2B | 19.7B | ||||
GBP | Trade Balance (Dec) | -10.35B | -10.64B | ||||
GBP | Trade Balance Non-EU (Dec) | -2.55B | -2.45B | ||||
USD | JOLTs Job Openings (Dec) | 5.400M | 5.431M |
Government Bond Auctions
Date Time and Country
Feb 08 16:20 Italy Details of bond auction
Feb 09 11:00 Netherlands Holds DSL auction
Feb 09 11:00 Austria Holds bond auction
Feb 09 11:30 Germany Holds I/L bond auction
Feb 09 11:30 UK 0.125% 2026 Gilt linker auction
Feb 09 n/a UK Details of Gilt auction on Feb 17
Feb 09 19:00 US Holds 3-year note auction
Feb 10 11:30 Germany Euro 5bn Mar 2018 Schatz
Feb 10 17:20 Sweden Details of bond auction on Feb 17
Feb 10 19:00 US Holds 10-year note auction
Feb 11 N/A Italy Euro 4-5bn 30-yr syndicated bond auction
Feb 11 11:03 Sweden Holds I/L bond auction
Feb 11 11:10 Italy Announces details of bond auction
Feb 11 11:30 UK 3.5% 2045 Gilt auction
Feb 11 19:00 US Holds 30-year bond auction
Feb 11 n/a US Details of 30-yr TIPS auction on Feb 18
Feb 12 11:10 France Details of bond auction on 18 Feb