The BOJ join the easing party

<p>The Bank of Japan jumped on the QE ladder following the Fed in extending asset buying and whilst expected, the aggressive nature of the easing […]</p>

The Bank of Japan jumped on the QE ladder following the Fed in extending asset buying and whilst expected, the aggressive nature of the easing sparked another spate of JPY selling.

-  extending its asset purchase plan six months from December 2012 to June 2013

-  increasing the size by 10 trillion JPY to 80 trillion JPY

-  removing the minimum bid requirement for JGB purchases.

China/Japan relations continue to be tense with the telegraph running an article today titled ‘ Beijing hints at bond attack on Japan’. The UK MPC minutes are released this morning but although there has been some divisions I expect the vote to support the current programme to be unanimous at 9-0. Euro seems to consolidating above 1.3000 as we watch the rise in Spanish bonds which is likely to continue until Spain ask the IMF for help.

US housing starts are the only distraction from across the pond this afternoon with the HSBC flash manufacturing PMI data for China released on Thursday being the next risk trading event as a reading below the 47/50 range seen this year sending a negative risk sentiment.

 


EUR/USD

Supports 1.3030-1.3010-1.2980 | Resistance 1.3110-1.3160-1.3220


USD/JPY

Supports 78.95-78.65-78.10 | Resistance 78.65-80.00-80.30


GBP/USD

Supports 1.6230-1.6210-1.6170 | Resistance 1.6280-1.6305-1.6380

 

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