Financial literacy with YENzo's Investment University (Academia) | Episode 14 [YENzo]

YEN ZOU's Profile

Enzō. He has worked for over 20 years as a foreign exchange dealer at U.S. banks such as Citibank, U.K. bank Standard Chartered, and other foreign banks. He is currently a top professional trader engaging in forex, the Nikkei 225, Nikkei options, and individual stock trading. He is the representative director of ADVANCE Co., Ltd., which specializes in distributing investment information. He has deep knowledge not only of major currencies such as the dollar and euro but also of emerging currencies, including Asian currencies, and he maintains close relations with foreign traders and fund personnel.

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*This article is a reprint/edit of FX Strategy.com March 2021 issue. Please note that the market information written in the text may differ from current market conditions.

Birth of the U.S. New Administration and Key Dates at the Start of the Year

This manuscript was written around December 22, and as 2020, which had been tumultuous, ends and this issue is already starting 2021 by the time it is published. Looking back at the recent situation, after the U.S. presidential election on November 4, the trend of rising stock prices and falling dollar began and continued into late December. In the third week of December, major central bank policy meetings were concentrated, and the events of 2020 largely ended during this week.

In the third week of December, the Federal Open Market Committee (FOMC) on the 15th–16th, the Swiss National Bank (SNB) on the 17th, the Bank of England (BOE), the Norges Bank, and the Bank of Mexico, and the Bank of Japan's policy meetings on the 17th–18th were held.

Although policy rates at many central banks remained as expected, the most watched was the FOMC. The FOMC introduced forward guidance that was strengthened as expected. While asset purchases were not extended or increased, they adopted forward guidance based on qualitative rather than numerical outcomes. In a sense, they committed to the outcomes. Even in advance, there was talk of stronger forward guidance.