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Aug 27, 2014

Weak yen remains Japan’s inflation anchor

LONDON, Aug 27 (Reuters) – Continuing and broad-based yen
weakness would sit comfortably with the objectives outlined by
Bank of Japan Governor Haruhiko Kuroda in his speech last week
at Jackson Hole, Wyoming.

For a text of Kuroda’s full remarks: here

The BOJ Governor said the mechanism for negotiating wage
increases “stopped working effectively” while Japan battled
deflation over the past two decades. He also said he wants to
“anchor inflation expectations at 2 percent” to act as a
benchmark for wage-setting.

Aug 20, 2014

Hollande thinks the euro’s overvalued, and he should know

LONDON, Aug 20 (Reuters) – French President Francois
Hollande said again on Wednesday that the euro is overvalued
and, looking at the state of the French economy, many might
agree with him.

France, the currency bloc’s second-biggest economy after
Germany, is afflicted by record-high jobless numbers, housing
starts at a 16-year low and waning industrial output.

Aug 11, 2014

Euro may give ground against the pound before BoE report

LONDON, Aug 11 (Reuters) – European Central Bank head Mario
Draghi’s words last week and what Bank of England chief Mark
Carney is likely to leave unsaid on Wednesday may combine to
push the euro lower against sterling in the coming days.

“The fundamentals for a weaker exchange rate are today much
better than they were two or three months ago,” Draghi said on
Thursday, referring to the external value of the euro.

Jul 23, 2014

Russia sanctions fear may see sterling dip vs Swissie

LONDON, July 23 (Reuters) – Sterling may have some room to
fall versus the Swiss franc if fear of tougher
sanctions sees Russian investors shift cash from Britain to

Russian investors, who have poured capital into Britain,
notably into its high-end real estate, will have noted British
Prime Minister David Cameron’s call for new sanctions on Russia
in the wake of last week’s downing of a Malaysian airliner over

Jun 18, 2014

Crude comparisons leave dollar in driving seat

LONDON, June 18 (Reuters) – The dollar should be the
ultimate beneficiary of the prolonged unrest in the Middle East
that has already seen the price of oil tick higher on fears of
supply disruptions.

Brent oil futures rose towards $114 a barrel on
Wednesday as heavy fighting in Iraq continued. Sunni militants
took control of most of Iraq’s second-largest oil refinery, an
official at the refinery said.

Mar 26, 2014

High summer in Japan may mean a low yen

LONDON, March 26 (Reuters) – The Japanese yen could be
vulnerable to a renewed emphasis on economic policies by Prime
Minister Shinzo Abe’s government, whose constitutional and
foreign policy objectives have become somewhat bogged down.

The combination of fiscal and mooted structural reforms
allied with supportive monetary policy easing by the Bank of
Japan (BOJ), often collectively called Abenomics, have so far
been a signal success for the Abe government.

Mar 24, 2014

Communications chain points to a higher dollar

LONDON, March 24 (Reuters) – The dollar should be the
ultimate beneficiary of U.S. Federal Reserve chief Janet
Yellen’s disclosure on Wednesday that the Fed may only wait six
months to raise rates once its bond buying programme is over.

Taken in tandem with policy stances in the euro zone and
Japan, the euro and the yen might be the big losers.

Mar 20, 2014

Crimea tensions might deliver weaker yen

LONDON, March 20 (Reuters)- Policymakers struggling to spark
inflation in Japan’s underperforming economy probably didn’t
have Crimea on their list of problems.

But some leading financial figures are raising the idea that
a prolonged crisis in the Ukrainian region annexed by Russia
might counter-intuitively result in a lower oil price that would
produce an unwelcome disinflationary impulse in Japan.

Mar 14, 2014

Turning Japanese? Euro zone exporters must hope not

LONDON, March 14 (Reuters) – Euro zone exporters must be
hoping European Central Bank (ECB) President Mario Draghi is
right when he rejects comparisons between the currency bloc and
Japan’s experience of deflation.

Or, just as Japanese exporters discovered for long periods
in the 1990s, today’s euro zone exporters might suffer as a
strengthening local currency eats into their bottom line and
gives their global competitors an edge.

Jan 22, 2014

Horse trading may give the Aussie a lift

LONDON, Jan 22 (Reuters) – The start of the Chinese Lunar
New Year on Jan. 31 may give the Australian dollar a lift
if Chinese investors choose to celebrate the Year of the Horse
by piling into a currency arguably ripe for a rebound.

While such a notion may prompt hoots of derision from
traders in the western hemisphere, the differing qualities of
the 12 years in the Chinese cycle are closely studied by
potential investors in Asia – and this horse has form.

    • About Neal

      "From 1985-2009, I worked in foreign exchange trading and latterly sales in the City. Since joining Thomsonreuters in Sept 09, I write columns on currency issues for the wire, contribute briefer daily FXComments, co-host the "Dealing Room" chatroom with colleagues across the globe, and appear regularly on FX related Inside shows."
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