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  • Article / Yesterday at 13:00 GMT

    Goldilocks and the three currency bears

    Head of Trading / The ECU Group plc
    United Kingdom
    Goldilocks and the three currency bears
    The US Federal Reserve, the Reserve Bank of New Zealand and the Bank of Japan all judged that the current growth and inflation backdrop is neither too hot, nor too cold. Their inaction reinforces a picture of central banks increasingly reaching the limits of monetary policy and of currencies playing a growing (if unspoken) role.
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    12h
    JakubSzalaFX JakubSzalaFX
    "through this low growth may well be above the current "potential growth""

    Interesting how the economy structure has changed after the crisis.

    Growth trend smoothing, due to unconventional...
  • Article / Yesterday at 8:54 GMT

    From the Floor: US economy teeters on brink, treasuries rally

    Saxo Bank
    Norway
    From the Floor: US economy teeters on brink, treasuries rally
    The US Federal Reserve kept interest rates unchanged on Wednesday and signalled it is in no hurry to hike, which some interpreted as a less hawkish stance than expected. An advance estimate of US first-quarter GDP is awaited on Thursday amid increasing signs that the economy could be flirting with negative growth, says Saxo Bank's chief economist Steen Jakobsen.
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  • Editor’s Picks / Yesterday at 5:46 GMT

    Market 'stunned' as BoJ holds off on more stimulus

    Bloomberg
    The Bank of Japan held off on expanding monetary stimulus, as Governor Haruhiko Kuroda and his colleagues opted to take more time to assess the impact of negative interest rates. The move comes as a surprise to the slight majority of economists surveyed by Bloomberg who had projected some action from the central bank in response to a strengthening in the yen that has cast a shadow over prospects for higher wages and investment. The currency rallied against the dollar immediately after the decision while stocks in Tokyo tumbled. Policy makers are betting that their success in bringing down borrowing costs since unveiling the negative-rate strategy in January will generate an acceleration in lending. They left unchanged three key easing tools -- the 80 trillion yen ($732 billion) target for expanding the monetary base, mostly through government-bond purchases, the 0.1% negative rate on a portion of the cash banks park at the BOJ, and a program to buy riskier assets including stocks.
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  • Editor’s Picks / Yesterday at 2:31 GMT

    Japan's data deluge - the economic takeaways

    Bloomberg
    Here’s what you need to know about the slew of economic indicators released in Tokyo Thursday morning as investors await the Bank of Japan’s policy decision later in the day. A key gauge of consumer prices slumped, leaving Governor Haruhiko Kuroda far from his 2% inflation goal. A rise in industrial output reflected a rebound from a month earlier, when auto production was crimped because of a steel-mill explosion; the outlook for the months ahead is poor. Household spending is volatile and fell again, while retail sales figures were mixed. The unemployment rate of 3.2 % indicates a tight job market, but this has yet to drive significant gains in wages for full-time workers. Core CPI shows the challenge Japan faces in fully escaping the deflation that marred the economy before Prime Minister Shinzo Abe and Kuroda launched their reflation campaign. The core index also weakened slightly, significant given it previously helped support the BOJ’s view that there is improvement in inflation.
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  • Article / Yesterday at 2:18 GMT

    The Yen run ending in tears is a prophecy come true

    Blogger / MoreLiver's Daily
    Finland
    The Yen run ending in tears is a prophecy come true
    Over a year ago I warned that the Japanese yen's weakening would end in tears. The tears started flowing last January, when the Bank of Japan surprised and lowered rates into negative territory. It was surprising, but probably a trend reversal. Today USDJPY is at an important juncture. Will the JPY's strengthening continue from here, or is something else afoot?
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    22h
    Juhani Huopainen Juhani Huopainen
    And so it went:
  • Editor’s Picks / Yesterday at 0:36 GMT

    For commodities, the bad times are just beginning

    Nikkei Asian Review
    For the commodities market, the good times have come and gone, but the bad times are only just beginning. Each commodities supercycle has always been followed by a downturn that lasted just as long, or longer. With demand weak and oversupply rampant, it is unlikely that this time will be any different. For many countries and companies, this means the only options are adapt or die. Commodities accounted for more than 80% of total exports in 63 of 135 developing countries in 2012-13. Brazil and South Africa were investor darlings until a few years ago. Now their economies are in turmoil, dragged down by their ailing mining sectors. Even richer countries, such as Canada and Australia, are suffering hangovers from the mining boom.
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