أشرف العايدي على سي ان بي سي العربية -- 03 أبريل 2013
Apr 3, 2013 15:33
Telling CNBC Arabia that yen traders await Thursday's BoJ decision, which will be scrutinized for whether governor Kuroda succeeds in producing a majority vote in favour of an increase in the amount of assets buys and extending the duration of bonds under the asset purchases program (APP to five years or longer, from the current three years.
There is also the contentious "bank note rule", which stipulates that total asset purchases by the central bank may not exceed total bank notes in circulation so as to avoid monetizing of the debt.
The worst from Cyprus is gone as long as there are no signs that haircuts on deposits spread to other Eurozone nations.
Both ADP and services ISM were a disappointment, which is leading to fresh yen strength vs USD.
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Wednesday's FOMC release of the dot plot and Warsh press conference pushed bond market to price rate higher probabilities for a 25-bp rate hike in September and a full chance of a similar rate hike in October. Note how the white and green graphs have moved from below zero (yellow circle) to above above zero, shifting from rate cut to rate hike expectations. The green graphs shows 0.86%, implying an 86% probability of a quarter point hike in September, accompanied by a rise in DXY and decline in gold. The 2nd chart highlights the importance of the June 15th gap, whose floor stands at 4245/6, presenting a solid short-term support, which held successfully yesterday.
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