BOE’s inflation report today
City Index November 12, 2014 2:06 PM
<p>The yen has been the main focus this week after hitting seven-year lows, breaking 116.00 yesterday, after comments on a sales tax delay and a […]</p>
The yen has been the main focus this week after hitting seven-year lows, breaking 116.00 yesterday, after comments on a sales tax delay and a snap election to be called by Kuroda. Overnight it seemed that we were heading that way again as USD/JPY broke the 116 level for a second time as Kuroda says he is not worried about hyper-inflation as a result of aggressive monetary easing. This momentum fell short again as Japan’s Cabinet Secretary Suga’s comments hit the wires, suggesting that there is no decision to postpone the sales tax or have a snap election. This gave the yen some strength for the rest of the Asian session, USD/JPY now trading below 115.50.
Today’s main event will be the BoE’s inflation report and Governor Carney speaking. the expectations for the report to reinforce the expected rate rise in mid-2015, but with this an expected dovish tone due to the latest GDP data for Q4 coming in at 0.6% of growth;0.2% lower than predicted, so some downward revisions could be in the report. The other concern for the BoE will be the wage growth data which is to be released an hour before the report with an expected uptick to 0.9% from its previous 0.7%. This may help in the path of the rate rise if on track and increasing. GBP/USD is currently trading above 1.5900.
The euro gained back some ground yesterday as it did most against a weak USD from the holiday. It has started very much flat so far with no direction as of yet but holding it gains from yesterday, with very little data out to guide it today it seems to be in the hands of the USD. It’s currently trading just below the 1.2500 level.
Supports 1.2450 1.2400 1.2355 | Resistance 1.2510 1.2550 1.2575
Supports 115.00 114.50 113.80 | Resistance 116.05 116.45 116.80
Supports 1.5870 1.5825 1.5785 | Resistance 1.5950 1.5990 1.6025
StoneX Financial Ltd (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.
No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.