Archived IMT (2010.12.10)

WILL ANOTHER CHINESE TIGHTENING shake off rising markets? The PBOC has raised reserve requirements twice last month after hiking interest rates on October 19. The stepping up of monetary tightening is a result of escalating bank lending and more recently mounting inflationary pressures (CPI at 4.4% in October, expected above 5% in November). The latest sign that PBOC will tighten policy is the cancellation of the 3-year auction after banks refused to buy bills at cheaper yields. The PBOCs refusal to lift yields suggests it will opt towards raising the reserve requirement ratio (RRR) instead of raising interest rates. If the PBOC goes with only the RRR and leaves interest rates unchanged, then the negative market reaction may be relatively modest. An actual hike in interest rates would have more of an impact in the form of stronger USD vs. EUR, NZD and AUD, and a short-lived pullback in yen crosses such as 62 in NZDJPY. Nonetheless, in the medium-term, I remain bullish USDJPY, expecting 85.90.

HERE ARE A FEW VIDEO TESTIMONIALS from my last paid seminar in London (March 2010) http://youtu.be/4trJRUZZWRE Had people flying from Singapore, LA, Koln & Dublin. As for the Jan 23 event, it is NOT a CMC Markets event but involving AshrafLaidi.com and ProTraders Club

http://www.ashraflaidi.com/about/workshop01.asp