FXMarketAlerts Team
FXMarketAlerts
Published at 06:47 (GMT) 03 Sep
BoJ Dissenter Takahide Kiuchi says hope Fed takes into account effect of its expected rate hike on global capital flows and overseas economies.
Responding too sensitively to short-term market reaction could delay necessary Fed rate hike, cause future market disruption. Does not see expected US rate hike to have huge impact on markets, damage on Japan's economy.
Japan is no longer in deflation, economy and prices are in stable rate. Irresponsible to maintain QQE just to avoid market disruption. Must consider demerits of long-term costs of QQE. Have learned since deploying QQE that inflation will not hit 2% just by BoJ saying so.
On FX, hawkish comments from BoJ Kiuchi. Also signalling his support for Fed to go ahead "just do it" with the rate hike? Sep 16-17, Oct 27-28 or Dec 15-16. More likely the first 2, as Fed does not want to hike before Christmas - possibly having impact on Christmas shopping season?
Also signalling Japan is no more in deflation and should taper QQE? Being a dissenter in recent BoJ meetings.
USD INDEX at 95.926, supported on dips - as there are support for Fed to go ahead to hike rates. Eye more Central bankers comments at G20 Ankara Sep 4-5. Focus on US initial claims Thursday and NFP on Friday. Support at 95.50, eye 96.40-50.
USD/JPY at 120.35-40, a tad weighed given ongoing concerns over China - and with BoJ Kiuchi warning on China. And also against more QQE - and saying Japan not in deflation. Offers at 120.50-60/120.80-00. Bids at 119.80-90/50. Eye Cross/JPY and US stocks today, for any risk aversion.
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