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JPY bulls should be cautious about the US-Japan trade talks – DBS Read More »
First of all, I think all the talk about the Fed losing independence can be ignored. It’s not going to happen. The chances are so low that it doesn’t even deserve the attention.
But let’s say it does happen, what would be the consequences?
Well, pretty much pure chaos. The extent of the damage to the economy cannot even be imagined.
Inflation expectations would de-anchor immediately, even if actual inflation stayed the same. The government would certainly pursue expansionary policies and that would increase inflation.
The US Dollar and US Treasuries would be avoided like the plague. Gold would literally rise “to the moon”. The stock market would experience the worst bear market in history. And the great recession and depression would be seen as nice periods in comparison.
The US Congress would never allow this to happen because there’s even no way back. There would be always the spectre of this happening again and the damage would be everlasting.
This article was written by Giuseppe Dellamotta at www.forexlive.com.
What would happen if the Federal Reserve lost its independence? Read More »
Headlines:
Markets:
It was a relatively quiet session in terms of headlines, with just some light market movements as well overall.
A slight bounce in the risk mood is keeping the dollar steadier and that held for the most part during the session. UnitedHealth reported poor Q1 earnings and slashed its profit outlook and that dragged Dow futures down late on, weighing slightly on the market mood as well. Dow futures turned negative on the news, falling by over 1% with UnitedHealth of course comprising of roughly 9% of the index – the biggest in terms of weightage.
Still, S&P 500 futures are up 0.4% with tech shares leading the way. Nasdaq futures are up 0.7% currently.
In FX, the dollar is recovering a little bit of ground after the declines yesterday. EUR/USD is down 0.3% to 1.1365 with USD/JPY up 0.5% to 142.55 on the day. USD/CHF is continuing to keep off its recent lows, up 0.5% to 0.8170 on the day. Meanwhile, USD/CAD is up 0.3% to 1.3890 and AUD/USD down 0.2% to 0.6358 at the moment.
Elsewhere, the bond market continues to keep steadier while gold is easing back a touch after racing to fresh record highs yesterday. The precious metal is still holding well above $3,300 though, not showing much signs of letting up.
As things stand, it’s still about watching out for trade/Trump headlines while at the same time figuring out how the tariffs are going to keep weighing on the global economy during the interim.
For now, markets are keeping the calm. At this stage, it’s either we get some positive developments on trade first or hard data that shows the negative drag from tariffs first. If the latter comes earlier, that will be the next hammer to fall on risk sentiment. But if it is the former, then markets can start to look to grow to be more optimistic at least.
Coming up later, we’ll have the ECB policy decision and US weekly jobless claims to contend with as well.
This article was written by Justin Low at www.forexlive.com.
ForexLive European FX news wrap: Light bounce in the dollar, risk; ECB up next Read More »
As a reminder, we’ll have market closures in Australia, New Zealand, Europe, as well as the UK in the coming two business days. It is that time of the year where the Easter Bunny is out to play for the weekend. In Europe, the Euronext, Xetra, and LSE are all closed as well as the TARGET services. So, that means extremely thin liquidity conditions during the upcoming sessions. It leaves only North America trading to observe normal market flows. To those celebrating, have a great break and enjoy the weekend!
This article was written by Justin Low at www.forexlive.com.
Reminder: Market closures in observance of the Easter break Read More »
India M3 Money Supply declined to 9.5% in March 31 from previous 9.6% Read More »
His other remarks are pretty normal but the headline comment stands out a little. That appears to be a cryptic message perhaps on trade relations with a certain someone surely.
This article was written by Justin Low at www.forexlive.com.
China premier Li: We should have the courage to break conventions when necessary Read More »
ECB expected to cut rates by 25bps amidst economic uncertainty. Focus on trade tensions and slowing inflation influencing ECB policy. Markets watching for clues on future rate cuts as forward guidance may not be forthcoming. EUR/USD hovers in overbought territory ahead of ECB meeting. More upside ahead or time for a retracement? The European Central […]
The post ECB April Meeting Preview: Expected Rate Cuts and Market Impact appeared first on Action Forex.
ECB April Meeting Preview: Expected Rate Cuts and Market Impact Read More »
The multi-week decline of the USD/JPY from the 28 March high of 151.21 has stalled today, supported by US President Trump’s “big progress” in US-Japan trade talks. The US/Japan implied interest rate policy curve trajectory continues to narrow, which supports further yen strength. Watch the 147.30 key medium-term resistance on the USD/JPY. This is a […]
The post USD/JPY Outlook: Relief Bounce in US Dollar Before Yen Strength Resumes appeared first on Action Forex.
USD/JPY Outlook: Relief Bounce in US Dollar Before Yen Strength Resumes Read More »
