IronFX Daily Commentary by Sakis Paraskevov | 18/12/2015
December 18, 2015 9:57 am
Main Points for the day • BoJ launches additional stimulus measures in a surprise move • The Bank of Japan kept its policy rates and QE target unchanged, but approved by a 6-3 vote the launch of additional measures aimed at encouraging corporate spending and hiring. • On top of the current exchange traded funds (ETFs) purchases program, the Bank will buy ETFs issued by firms that are proactively making investments in physical and human capital. • Through these measures, the Bank aims to foster wage growth in the private sector and boost inflation over the longer term. • Overall, the Bank maintained an upbeat tone on the outlook of the Japanese economy and that inflation expectations appear to be rising somewhat. • As a result, JPY depreciated initially but regained its losses and traded higher in the following minutes. On a longer term perspective, the new measures could help the Bank achieve its 2% inflation target and strengthen the yen. • Today: • Norway: The official unemployment rate for November is forecast to have increased. This could weaken NOK a bit. • Eurozone: Current account balance for October. This is usually not a major market mover. • Canada: CPI data for November. Both the headline and core figures are expected to have accelerated, which could ease some of the selling pressure on the Loonie following the oil prices decline. • US: Preliminary Markit service-sector PMI for December. • Speakers: Richmond Fed President Jeffrey Lacker and Norges Bank Governor Oystein Olsen speak.
Main Points for the day
• BoJ launches additional stimulus measures in a surprise move
• The Bank of Japan kept its policy rates and QE target unchanged, but approved by a 6-3 vote the launch of additional measures aimed at encouraging corporate spending and hiring.
• On top of the current exchange traded funds (ETFs) purchases program, the Bank will buy ETFs issued by firms that are proactively making investments in physical and human capital.
• Through these measures, the Bank aims to foster wage growth in the private sector and boost inflation over the longer term.
• Overall, the Bank maintained an upbeat tone on the outlook of the Japanese economy and that inflation expectations appear to be rising somewhat.
• As a result, JPY depreciated initially but regained its losses and traded higher in the following minutes. On a longer term perspective, the new measures could help the Bank achieve its 2% inflation target and strengthen the yen.
• Today:
• Norway: The official unemployment rate for November is forecast to have increased. This could weaken NOK a bit.
• Eurozone: Current account balance for October. This is usually not a major market mover.
• Canada: CPI data for November. Both the headline and core figures are expected to have accelerated, which could ease some of the selling pressure on the Loonie following the oil prices decline.
• US: Preliminary Markit service-sector PMI for December.
• Speakers: Richmond Fed President Jeffrey Lacker and Norges Bank Governor Oystein Olsen speak.
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