Tapering plans still on track for coming months As a preliminary gauge of overall investor sentiment we see that in the US, major equities suffered a third day of losses at close yesterday. This morning Asian counterparts continued with the negative hand over. The main culprit supporting the move was the Federal Reserve Minutes published yesterday evening. Overall despite the overshadowing commitment to stimulus as long as is needed, voiced equally by Bernanke and Yellen recently, it looks like the path to tapering has not been derailed. As can be expected with the USD/JPY mostly driven by the underlying yields, the currency pair has gained at least 80pips from the 100 mark that dominated the levels prior to the minutes’ release yesterday evening. The USD/JPY is currently trading at 100.77, levels last seen in September. The FOMC minutes showed that improving economic conditions could trigger the tapering of asset purchases in the coming months. Fed officials sounded quite optimistic that upcoming economic performances would be in sync with their expected outlook. The USD gained traction even against the euro, the EUR/USD is currently trading at 1.3408 after shedding one big figure throughout trading yesterday – closing the session at 1.3438. Despite the understandable effect of the FOMC minutes on the US dollar it looks like the real boost lower for the EUR/USD came earlier just minutes after 1600 CET on news headlines circulating comments that the ECB is considering negative deposit rates for commercial lenders that are parking excess cash at the central bank. Overnight Chinese HSBC Manufacturing PMI slipped slightly lower to 50.4. This morning Swiss trade surplus registered a minor gain and French PMI disappointed expectations and actually slipped below 50 for Services. Good day,
Posted on: Thu, 21 Nov 2013 08:25:21 +0000
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