Ok, perhaps I'm not asking this correctly. Do you guys believe that the rise in Chinese rates this weekend will cause an appreciation in the yen? Don't worry, I'm not going to hold you to it. Just interested in your opinions.
I am not sure how "unexpected" this hike is or how much of a surprise it _really_ is. Let's see how Tokyo, HK and Shanghai open tonight.
"But to come back to the yen, what will make a big impact is diversification of Chinaâs reserves into yen, arguably the worldâs most undervalued currency." full article http://www.business-standard.com/common/storypage.php?leftnm=lmnu5&subLeft=&autono=278067&tab=r and we all know what China is about to dip their toes into.
If this is an accurate warning, and I can't think of a reason why they would publicly say this without it being true (maybe there is a rational reason - anyone?), it would mean pressure on the yen carry trade, which is exactly what has everyone spooked right now. They are basically announcing their intentions to put downward pressure on the USD, and more importantly, they are singling out the Japanese yen as an "undervalued' currency. I can not, for the life of me, understand why they are talking this line when they hold such huge dollar reserves, and depend so heavily on the U.S. as an export market.
JPY up +0.45% from Friday session. Globex futures down a third of a %. So far so good, nothing dramatic as of yet.
Bloody Bullish in those important markets in Asia this morning 12:45 HK time: N225 +1.25% KOSPI +0.78% SSEC +2.51% (morning close) HSIF current month +0.98% (morning close)