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21 May 2013
Flash: Markets are waiting - Societe Generale
FXstreet.com (Barcelona) - Kit Juckes, Global Head of Currency Strategy at Societe Generale notes that markets are waiting.
He sees that yesterdays London morning was very dollar focused, while. Japan’s Economics Minister, Akira Amari was quoted as saying that further weakness may hurt the Japanese people which was causally interpreted a signal that the yen has fallen enough, by a market where yen positioning is perhaps as big as it can get. Juckes feels that that definitely doesn’t signal the end of yen weakness but leaves markets waiting for Wednesday’s BOJ update. Further, yesterday, European markets were on holiday and in any case, waiting for Thursday’s ‘flash’ PMI data. There was no ‘new news’ and so downward pressure on the Euro abated and he adds, “I want to stay long USD/CHDF, and receiving 2yr/2yr Euros vs. USD, but I’m not really sure where I am going to get fireworks from this week.”
Looking to todays docket, he notes that the UK sees inflation data, and the latest MPC Minutes and retail sales data on Wednesday. Public sector spending data, the CBI Trends survey and GDP details are also due. He writes, “EUR/GBP is somnolent. I’d rather be short than long and I’d rather own 10yr Gilts than Treasuries, but excitement isn’t easy to find.” Finally, he shifts to the US which he sees is waiting for Wednesday, Bernanke’s testimony to the JEC of Congress, and the FOMC minutes. He expects the FOMC to have discussed tapering but Bernanke to be on the dovish side of the debate because, well, he’s Bernanke. Juckes finishes by commenting, “No-one thinks we are going to get news this week which justifies a further push higher in US yields and rate expectations. Which means that would be the move which could cause the most impact in a complacent market.”
He sees that yesterdays London morning was very dollar focused, while. Japan’s Economics Minister, Akira Amari was quoted as saying that further weakness may hurt the Japanese people which was causally interpreted a signal that the yen has fallen enough, by a market where yen positioning is perhaps as big as it can get. Juckes feels that that definitely doesn’t signal the end of yen weakness but leaves markets waiting for Wednesday’s BOJ update. Further, yesterday, European markets were on holiday and in any case, waiting for Thursday’s ‘flash’ PMI data. There was no ‘new news’ and so downward pressure on the Euro abated and he adds, “I want to stay long USD/CHDF, and receiving 2yr/2yr Euros vs. USD, but I’m not really sure where I am going to get fireworks from this week.”
Looking to todays docket, he notes that the UK sees inflation data, and the latest MPC Minutes and retail sales data on Wednesday. Public sector spending data, the CBI Trends survey and GDP details are also due. He writes, “EUR/GBP is somnolent. I’d rather be short than long and I’d rather own 10yr Gilts than Treasuries, but excitement isn’t easy to find.” Finally, he shifts to the US which he sees is waiting for Wednesday, Bernanke’s testimony to the JEC of Congress, and the FOMC minutes. He expects the FOMC to have discussed tapering but Bernanke to be on the dovish side of the debate because, well, he’s Bernanke. Juckes finishes by commenting, “No-one thinks we are going to get news this week which justifies a further push higher in US yields and rate expectations. Which means that would be the move which could cause the most impact in a complacent market.”