Risk appetite extended its stay in the financial markets, buoying stocks and commodities higher for the Asian session. Strangely enough, the lower-yielding yen managed to rake in some pips while the euro also advanced.
- Australia’s NAB business confidence index rose from 10 to 12 in Jan
- Japanese preliminary machine tool orders up by 48.8% y/y in Jan
- U.K. inflation reports due next
Doubts about Kuroda’s next term
After rumors swirled that the Japanese government is set to reappoint current BOJ head honcho Kuroda for another full term, PM Abe clarified that he hasn’t quite decided yet.
Instead he simply mentioned that lending remains healthy despite negative deposit rates and added:
“I expect the BOJ to continue to take bold steps to achieve price stability in response to movements in prices and the economy.”
However, lawmakers appear open to another five-year stint by Kuroda as Finance Minister Aso stressed the need for strong English communication skills from a central bank head – something that Kuroda is already known for.
In his own speech, Kuroda didn’t say anything to address these rumors but instead took the opportunity to take a jab at cryptocurrencies, saying that the likes of bitcoin are used purely for speculative activity.
A bit more risk appetite
Asian markets chalked up another day in the green, with the exception of the Nikkei.
- Nikkei 225 index is down 160.62 points to 21,222.00 (-0.75%)
- S&P ASX 200 is up 35.20 points to 5,855.90 (+0.60%)
- China A50 index is up 212.85 points to 13,231.16 (+1.65%)
Commodities are also in positive territory as traders seem hungry for more risk.
- Gold is up to $1,327.50 per troy ounce (+0.08%)
- WTI crude oil is up to $59.59 per barrel (+0.49%)
- Brent crude oil is up to $62.91 per barrel (+0.51%)
Futures are pointing to a mixed performance in the upcoming sessions, with some signs of jitters ahead of the U.K. CPI releases.
- Euro Stoxx 50 futures are up to 3,385.00 (+2.36%)
- French CAC 40 futures are up to 5,163.00 (+1.73%)
- FTSE 100 futures are down to 7,172.2 (-0.25%)
Major Market Mover(s):
Easing fears about another five years of ultra-easy monetary policy from the BOJ allowed the yen to recover against some of its peers.
USD/JPY is down 50 pips to 108.14 (-0.47%), AUD/JPY is down 38 pips (-0.44%), CAD/JPY fell to 85.97 (-0.46%), and GBP/JPY is down 54 pips to 149.80 (-0.36%)
The shared currency is raking in some gains, despite the lack of any clear catalysts.
EUR/USD is up to 1.2319 (+0.23%), EUR/AUD rebounded by 30 pips to 1.5665 (+0.19%), EUR/CAD is up to 1.5488 (+0.19%), and EUR/NZD is up to 1.6934 (+0.09%).
Watch Out For:
- 7:45 am GMT: French preliminary non-farm payrolls q/q (0.2% expected, 0.3% previous)
- 8:15 am GMT: Swiss PPI m/m (another 0.2% uptick expected)
- 9:30 am GMT: U.K. headline CPI (dip from 3.0% to 2.9% eyed)
- 9:30 am GMT: U.K. core CPI (increase from 2.5% to 2.6% expected)
- 9:30 am GMT: U.K. PPI input prices (0.7% expected, 1.0% previous)
- 9:30 am GMT: U.K. PPI output prices (0.2% expected, 0.4% previous)