The Bank of Japan partially filled market expectations when it adopted a two percent inflation target but disappointed by not adding to its asset purchase plan until 2014. The Bank of Canada as expected left its key rate at 1.0 percent where it has been since September 2010. Economic data indicated an improvement in the global economic picture. The FOMC holds a two day meeting this week — no policy changes are expected. There is an outpouring of new economic data globally. Investors will be looking to see if the fledgling sprouts of improvement continue. The exception here is Japan where the country is mired in
Sunday, 27 January 2013
Monday, 21 January 2013
Markets were mixed last week as economic and earnings data vied for attention. Investors tried to anticipate what the Bank of Japan will do at its meeting at the beginning of the week. Most economic data were positive in the U.S. and China while those in Europe tended to disappoint. The Bank of Japan meets the first two days of the week. As noted elsewhere, the monetary policy board is expected to add additional stimulus to shake the economy out of deflation and get it growing again. The BoJ and the Government reached a basic agreement Thursday on the substance of an upcoming joint statement on fighting deflation. The document will call for the BoJ to adopt a 2.0 percent inflation target, and charge the central bank's governor with reporting regularly on progress toward this objective. Elsewhere, the Bank of Canada is expected to leave its policy interest rate at 0.5 percent. Flash January purchasing managers’ indexes will be released for China, U.S., Eurozone, France and Germany and will give us our first look at January manufacturing data. The UK reports its initial fourth quarter GDP data.
Sunday, 13 January 2013
It was a mostly quiet week with no new news from either the Bank of England or the European Central Bank. The Bank of Korea also maintained the status quo. European economic data centered on monthly merchandise trade and industrial output data. German manufacturing orders and industrial output disappointed as did UK industrial and manufacturing output. The spate of merchandise trade and output data continues this week. The pace of new data releases in the Asia Pacific region picks up as China releases its fourth quarter growth data along with key industrial production and retail sales data for December. Australia’s labour force survey will attract wide interest in the financial markets as well.
Tuesday, 8 January 2013
Investors focused on the budget negotiations in the U.S. as the old year wound down. They staged a relief rally when an agreement on taxes was reached. However, no agreement was reached on spending cuts and the debt ceiling. The negotiations will continue. The Bank of England and the European Central Bank will meet Thursday. No policy change is anticipated from either Bank. New economic data revolves around international trade and industrial production for the most part.
Thursday, 3 January 2013
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