Oil has hit a 15-month high on the back of optimism over the Opec deal which needs to be sorted out by November 30. But, with a record long position building across the combined benchmarks, a disappointment could leave some exposed. Full report to come within the hour....
Squawk / 21 September 2016 at 4:54 GMT
Head of FX Strategy / Saxo Bank
Bank of Japan reaction: Market read is dovish – though reaction relatively modest given anticipation. The BoJ can do as much QE as it wants and if fiscal steps in with very large programme, there is not necessarily any limit to their purchases – open ended, though that also means they can buy fewer bonds if that is what is needed.

From BoJ

No rate cut (many were expecting more focus on negative rates and some even a rate cut)
New policy focus on shape of yield curve – current level of JGB 10-year deemed appropriate- new “fixed rate” bond buying operations for up to 10 year bonds
No set amount for expansion of monetary base
BUT monetary base to expand until CPI consistently in excess of 2%

(News had emerged overnight, btw, that BoJ had already tapered its long bond purchases earlier this year)


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