22 May 2015
Little tension over the Bank of Japan policy meeting - Westpac
FXStreet (Bali) - There is little tension over the Bank of Japan policy meeting today, notes Sean Callow, FX Strategist at Westpac, also providing the bank's view on the upcoming German IFO business climate and US CPI numbers.
Key Quotes
"There is little tension over the Bank of Japan policy meeting (decision due any time from about 11:30am Tokyo/12:30pm Syd/10:30am Sing/HK; the same meeting a year ago concluded 11:41am). Governor Kuroda and colleagues have sounded comfortable with the current policy stance and are likely to point to the slight upside surprise on Q1 GDP as further vindication. The JPY80 trillion annual increase in the monetary base seems sure to be maintained though there is an outside risk of a slight change in composition of asset purchases. The press conference is due around 3:30pm Tokyo."
"In Germany we have May IFO business climate. The ZEW survey earlier this week was disappointing. The renewed appreciation of the euro should weigh; market consensus is for the IFO business climate index to slip to 108.3 from 108.6. The press conference following the European Council’s Eastern Partnership summit in Riga should produce a flurry of headlines, especially on Greece."
"US Apr CPI will be released. The focus will be on the core print (ex food and energy), expected at 0.2%m/m and 1.7%y/y. Core pressures should remain modest, with the US dollar weaker and airfares unlikely to fall again. PPI suggests that food prices have remained soft, though gas prices have risen again in Apr. We also hear from Fed chair Yellen on the US economic outlook. Canada Apr core CPI is expected to remain at 2.4%, the highest since 2008. Canada Mar retail sales will also be released."
Key Quotes
"There is little tension over the Bank of Japan policy meeting (decision due any time from about 11:30am Tokyo/12:30pm Syd/10:30am Sing/HK; the same meeting a year ago concluded 11:41am). Governor Kuroda and colleagues have sounded comfortable with the current policy stance and are likely to point to the slight upside surprise on Q1 GDP as further vindication. The JPY80 trillion annual increase in the monetary base seems sure to be maintained though there is an outside risk of a slight change in composition of asset purchases. The press conference is due around 3:30pm Tokyo."
"In Germany we have May IFO business climate. The ZEW survey earlier this week was disappointing. The renewed appreciation of the euro should weigh; market consensus is for the IFO business climate index to slip to 108.3 from 108.6. The press conference following the European Council’s Eastern Partnership summit in Riga should produce a flurry of headlines, especially on Greece."
"US Apr CPI will be released. The focus will be on the core print (ex food and energy), expected at 0.2%m/m and 1.7%y/y. Core pressures should remain modest, with the US dollar weaker and airfares unlikely to fall again. PPI suggests that food prices have remained soft, though gas prices have risen again in Apr. We also hear from Fed chair Yellen on the US economic outlook. Canada Apr core CPI is expected to remain at 2.4%, the highest since 2008. Canada Mar retail sales will also be released."