In today’s briefing:
- Nikkei 225’s Comeback
- Could the BoJ Be Saved?
- UK: Inflation Loses Some Core Support
- CX Daily: To Keep Stimulus Flowing, China’s Local Governments Need a Budget Fix
Nikkei 225’s Comeback
- Emerging trends and dynamics across international markets coupled with the BoJ’s policy are lining up to support the Nikkei 225
- Historical comparisons, if correct, also indicate a strong bounce. The price action on the Nikkei 225 itself is also bullish.
- At this stage in a volatile market we remain fixed on short term dynamics and refrain from longer term outlooks where conviction still neds to be built
Could the BoJ Be Saved?
- Japan is clearly worried about a weaker JPY despite the BoJ’s bond market policy
- Could they be saved by external factors – namely a calming down or even reversal of rising US yields?
- Historical comparisons as well as developments in commodities and the economy suggests the answer could be yes
UK: Inflation Loses Some Core Support
- UK CPI inflation matched forecasts by rising slightly to 9.1% amid relatively small offsetting surprises, although the RPI was more adversely affected and rose to 11.7%.
- Strength in food and energy is masking an easing of core pressures under most definitions. It’s too early to say if that’s a genuine turn or a mere lull.
- Inflation remains too high, even if it’s not matching BoE fears, so ongoing rate hikes are necessary. FX pressure is encouraging potentially inappropriate aggression from some.
CX Daily: To Keep Stimulus Flowing, China’s Local Governments Need a Budget Fix
In Depth: To keep stimulus flowing, China’s local governments need a budget fix
Police officers probed over handling of Tangshan women’s assault
Henan resident sues health authorities alleging health code abuse
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