Halister News

(Bloomberg) -- Japanese yen jumped to its strongest level since Sept. 2014 after BOJ refrains from expanding stimulus as Governor Kuorda studies the impact of his negative-rate policy.

• USD/JPY slides as much as 1.4% to 104.53
  • BOJ votes 8-1 to keep its monetary base target unchanged, votes 8-1 on asset-purchase program and votes 7-2 to maintain negative rate policy
  • USD/JPY selling accelerates after 105.00 option barriers triggered, according to Asia-based FX traders.
  • BOJ says it will add stimulus if needed, and CPI may be slightly negative or about 0% for time being
• BOJ decision comes after Fed signaled a slower pace of rate increase; Fed decision puts onus on BOJ to act to prevent deflation, Rabobank says before Japanese central bank statement
• Fed decision sent dollar falling, boosting most Asian currencies
  • Still, risk aversion play leading up to next week’s Brexit event will supersede Fed, says Stephen Innes, senior trader at Oanda Asia Pacific
• Aussie reversed gains to slip 0.14% to 0.7397 after revision to April job data; Gains in April cut to 800 from 10,800
  • Employment in May rose 17,900 from prior month; economists forecast 15,000 gain
  • Aussie bond yields drop to record low below 2% amid Brexit fears
• Onshore yuan slips; downward pressure on Chinese yuan likely to increase in coming days, as market shifts focus from Fed to Brexit: Natixis
  • China may cut benchmark lending rate this month to support economy, and as dovish Fed posts less outflow pressure: Commerzbank
  • China’s holdings of U.S. equities sank $126b, or 38% from July to March, while keeping its U.S. Treasury holdings stable
• South Korean won rises while sovereign bond yields hit record lows after Fed holds rates and lowers dot plot projections
  • Nation is reviewing various ways to increase fiscal spending in 2H although govt hasn’t made decision on whether to draw up extra budget: Finance Ministry
• Southeast Asian currencies advance, with baht and rupiah leading gains
• Rupiah gains before Bank Indonesia decision today
  • BI is likely to keep reference rate unchanged at 6.75% according 18 of 29 economists in Bloomberg survey; rest see cut to 6.50%
  • Stay long on 10-yr govt bonds, targeting 7%, as BI’s monetary easing bias is main support for nation’s bond mkt, HSBC says in note today
  • Relatively low level of inflation allows central bank to proceed with policy rate reductions; next easing is expected today; more easing likely this year
• Philippine central bank doesn’t need to match any Fed rate increase, Deputy Governor Guinigundo says in televised interview yesterday
  • Says peso to stay stable in long run
  • Malaysia plans to change way it sets ringgit’s daily reference rate to boost transparency, BNM said late yday; will also extend dollar-ringgit trading to 6pm from 5pm local time