The BoJ left policy unchanged but sounded cautiously optimistic on inflation. A study of the 23 January Market Moving Fundamental Events reveals other developments affecting the market.
23 January, HotForex – Bond yields quickly started to head south in early trade, amid a wider correction in 10-year yields across the U.S. Japan, China, Australia.
European Market Outlook
The 10 year Bund yield is now down -0.2 bp at 0.561%, despite gains in European and U.S. stock futures, after equities rallied in Asia, on news that the U.S. government shutdown is ended and amid optimism about corporate earnings.
The BoJ left policy unchanged but sounded cautiously optimistic on inflation. The MSCI Asia Pacific Index reached headed for fresh record highs, despite warnings of overheating as the IMF’s economic outlook confirmed that growth is already starting to slow down from high levels.
Today’s local calendar has German ZEW investor confidence as well as U.K. public finance data and the U.K. CBI industrial trends survey. Preliminary eurozone consumer confidence will be published in the afternoon.
BoJ’s Kuroda sounded dovish at his post-meeting press conference. He said that the central bank will remain strongly committed to monetary easing, including QQE until the 2% inflation target has been reached, which remains “far” from the case. He said that the BoJ remains committed to yield curve control and, downplaying the January-9 announcement of a trimming in long-dated JGB purchases, said that day-to-day operations are not an indication of future monetary policy.
The yen declined by about 30 pips versus the dollar, and traded lower versus other currencies, in the wake of Kuroda’s remarks. Meanwhile, EURUSD bottomed at 1.2225 as news reports indicated there were enough Senate votes to pass spending legislation, ending the government shutdown.
Senate has advanced a temporary spending bill in an 81-18 vote. This will refund the government through February 8.The Senate still needs to vote on final passage of the CR, and then send it back to the House for its OK, which will be passed, according to leadership.
Main Macro 23 January Market Moving Fundamental Events
- WEF Annual Meetings
- UK Public Sector Net Borrowing – should fall to £4.400B in December after November’s £8.118B.
- German ZEW Economic Sentiment – expected to stabilize at 18.0 after falling to 17.4 in December underpinned by confidence in the global economy.
- EU Consumer Confidence – preliminary Confidence expected to rise at 0.6 for January than 0.5 seen last month.
Support and Resistance Levels
This article about 23 January Market Moving Fundamental Events was written by Andria Pichidi, Market Analyst at HotForex. The provided article is a general marketing communication for information purposes only. It does not constitute an independent investment research. Nothing in this communication contains an investment advice or an investment recommendation. It also does not contain a solicitation for the purpose of buying or selling of any financial instrument.
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