There are many high-profile statements planned, focusing on MPC members! ~ Highlights and schedule for November 20 ~

◎Today's Highlights

1)Risk-off Market

Both major U.S. stock indices fell sharply. European stock indices started in positive territory at the opening but slipped into the negative as well. Long-term interest yields also declined. Globally, there is a tilt toward risk-off. There are many risk-off factors, but nothing is definite. While there are incidents such as the arrest of Renault-Nissan CEO Ghosn, the impact of the U.S.-China trade war, the drop in crude oil prices, Brexit negotiations, and Italy’s budget, none are decisive. If I had to say, it seems like risk-off is driven by a combination of factors.

In a risk-off environment, bonds are bought, antipodean currencies are sold, and there is yen and franc buying. We will continue to watch whether risk-off persists today.

2)British Politics

One of the risk-off factors is British politics. Regarding the provisional Brexit agreement, the UK Parliament and ruling party are in turmoil. Reports say that if Prime Minister May remains, the Northern Ireland DUP party in coalition will refuse to cooperate. Within the governing party, leadership changes and parliamentary shifts are among the many problems. Some reports suggest a leadership challenge could be submitted today or tomorrow. The headlines may move significantly today as well, so stay alert.

3)Italy Budget

Regarding Italy’s budget, both Italy and the European side are accusing each other. European authorities fear that being lenient toward Italy could lead to similar actions by Greece or Spain. Conversely, stricter responses could provoke backlash. Italy aims to use the budget to shake up Europe and boost the rise of far-right parties. Italy’s goal is to advance the EU Parliament elections next year on favorable terms.

Given this situation, expect exchanges of stance and statements from both sides. We will pay attention to the headlines.

4)Key Figures’ Speeches

In the UK, four MPC members are scheduled to testify to Parliament. Also on the agenda are remarks from Low RBA Governor Lowe, the German Bundesbank President, and the Bank of Canada Governor. Today features numerous statements from key figures. In particular, keep an eye on the MPC members (BoE).

◎Today’s Event Schedule

11/20 (Tuesday)

09:30 AUDRBA Board Monetary Policy Meeting Minutes
17:20 AUDLow RBA Governor Speech
19:00 GBPCarney BoE Governor Speech (Parliamentary Testimony)
19:00 GBPBarr Safe BoE Deputy Governor Speech (Parliamentary Testimony)
19:00 GBPHaldane Chief Economist Speech (Parliamentary Testimony)
19:00 GBPThomson BoE External Member Speech (Parliamentary Testimony)
22:00 HUF Hungary Policy Rate

11/21 (Wednesday)

00:00 EUR Weidmann German Bundesbank President Speech
03:00 CADWilkins BOC Deputy Governor Speech

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