Good Morning All;
lookat the Headlines International.
The Bank of Japan will continue with very accommodative monetary policy and maintain the current pace of asset purchases for some time, Governor Haruhiko Kuroda said in an interview. While Japan’s economy is doing better than thought a few months ago, the inflation rate is still quite sluggish, Kuroda said in New York on Thursday.
currency is advancing toward 105 per dollar, a level last seen just after U.S. voters unexpectedly elected Trump in November. One-month risk reversals show traders are about the most bullish on the yen since June, while speculators have resumed bets the Japanese currency will strengthen.
Treasury Secretary Steven Mnuchin said Thursday the Trump administration plans to release its tax reform proposal “very soon” and promised that a sweeping overhaul of the tax code will get done.Speaking at a conference of international financial firms in Washington, Mr. Mnuchin said Treasury is “pretty close to being able to bring forward what’s going to be major tax reform.” “This will be the most significant change to the tax code since Reagan,” he said, adding that the plan “will pay for itself” by boosting economic growth.
Federal Reserve staff, widening their outreach to investors in anticipation of a critical turning point in monetary policy, are seeking bond fund manager feedback on how the central bank should tailor and communicate its exit from record holdings of Treasuries and mortgage-backed securities. Fed officials are intent on shrinking their crisis-era $4.48 trillion balance sheet in a way that isn’t disruptive and doesn’t usurp the federal funds rate as the main policy tool. To do that, they need to find the right communication and assess market expectations on the size of shrinkage, which is why conversations with fund managers have picked up recently.
Dictatorships are on a hot streak in the bond market. In the past year, sovereign notes from emerging markets under autocratic rule have returned 15 percent on average, compared with just 8.6 percent for securities from developing countries considered democratic, according to data compiled by Bloomberg. They also have better returns over the past two years, though beyond that the advantage fades.
The Brent physical oil market is flashing signs of weakness again as dwindling Asian purchases, an influx of American crude to Europe, and supplies flowing out of storage all combine to recreate a glut in the North Sea. The weakness comes at a time when speculators have started rebuilding bullish positions after a sell-off last month, betting the market will tighten in the second quarter. Yet, Brent physical oil traders say the opposite is happening so far.
Deutsche Bank AG was hit with the Federal Reserve’s first major fine for failing to ensure traders abide by the Volcker Rule’s ban on risky market bets — and will pay even more for letting currency desks chat online with competitors, allegedly revealing positions.
Brazil’s economy will emerge from its worst recession on record in the first quarter of this year, Finance Minister Henrique Meirelles said in an interview with Bloomberg News and TV.Latin America’s largest economy is estimated to have grown 0.5 percent to 0.7 percent quarter-on-quarter in the three months ending in March, Meirelles said in an interview with Bloomberg TV and News in Washington D.C. He expects the economy to expand 2.7 percent in the fourth quarter from a year earlier.
Turkey’s Deputy Prime Minister Mehmet Simsek said that the nation’s economy will see better conditions going forward and promised to push ahead with new reforms that he considers the main drivers for growth. Turkey has been rattled by political instability in recent years including five elections in three years, terror attacks and a government crackdown on opponents after an attempted coup last July. The government at the weekend won a narrow victory in a constitutional referendum that expanded the powers of President Recep Tayyip Erdogan.
Market in details
The Bloomberg Dollar Spot Index was unchanged, erasing a loss that reached 0.3 percent after Kuroda’s comments to Bloomberg News. The measure surged 0.5 percent Wednesday.
The pound rose 0.3 percent to $1.2819 and the euro climbed 0.13 percent to $1.0725.
The yen weakened 0.4 percent to 109.34 per dollar, following a 0.4 percent decline on Wednesday.
Aussie recovered overnight somewhat above 0.7500 because of a recovery in the iron ore price
NZD/USD slips 0.1% to 0.7006, finished week down ~0.9%
The euro rose to its highest since March 29 amid short covering ahead of French election; market still in wait- and-see stance.
The yield on 10-year Treasuries rose two basis points to 2.24 after a five-basis-point advance Wednesday.
German government bond yields with a similar maturity added four basis points to 0.24 percent.
Australian sovereign bonds fall, matching similar moves in Treasuries on comments from U.S. Treasury Secretary Mnuchin that plans to reform taxes have progressed.
The S&P 500 rose 0.8 percent to 2,355.92 at 4 p.m. in New York.
The Stoxx Europe 600 Index edged higher by 0.2 percent after swinging between gains and losses.
Emerging-market equities jumped 0.6 percent.
West Texas Intermediate oil fell 0.3 percent to $50.27 a barrel, after tumbling 3.8 percent Wednesday when a report showed U.S. gasoline supplies increased for the first time since February, while crude output keeps rising.
Gold futures were little changed at $1,282.80 an ounce in New York.