Did the Bank of Japan's monetary policy announcement pass without a hitch!? The attention is whether the QE amount reached 80 trillion yen? ~January 23 highlights and event schedule~
Yesterday saw a sharp risk-off move. I think the U.S.-China relationship is a factor. Also, combined with weak U.S. existing home sales data, I believe this contributed to the stock price decline.
◎ Today's Points of Attention
1) U.S.-China Relations
There are renewed concerns between the U.S. and China over the extradition of Huawei CFO. Also, since there is no settlement between the U.S. and China regarding intellectual property, reports that the U.S. rejected a ministerial-level meeting caused risk-off sentiment. After subsequent denials, the reaction was limited. The VIX index has again moved above the key level of 20.
Stock prices fell sharply, and the USD/JPY moved higher in yen strength. Focus remains on U.S.-China relations today as well.
2) Budget Bill and Government Shutdown
The U.S. budget remains unresolved. The government shutdown has exceeded one month. The situation is affecting the economy, including some indicators not being released. There is no clear path to a solution yet. Personally, I think a state of emergency declaration could be a solution. Watch the actions of President Trump.
Also, pay attention to rating agencies and U.S. Treasuries.
3) Davos Meetings (World Economic Forum Annual Meeting)
Today, Prime Minister Abe is scheduled to speak.
Additionally, leaders from various countries will gather to discuss the economy. Last year, discussions focused on protectionism; this year, global economic slowdown is likely to attract attention. Naturally, protectionism will be watched as well, but with many officials present, I will be mindful of statements and headlines.
4) Bank of Japan Monetary Policy Meeting
Today's BOJ Monetary Policy Meeting is expected to hold rates and make no changes. If anything, attention will be on the size of QE, yield-curve control, and target values for fixed-rate operations. I will be watching the introductory press conference. If Governor Kuroda’s press conference hints at an exit from stimulus, yen appreciation could occur. Pay close attention.
◎ Today's Economic Event Schedule
Wednesday, January 23
Davoss Conference (World Economic Forum Annual Meeting)
Abe's Speech (Davos Conference)
08:50 JPY Trade Balance
Around 12:00 JPY Bank of Japan Monetary Policy/Policy Rate Announcement
15:30 JPYKuroda BOJ Governor Press Conference
22:30 CAD Retail Sales
Thursday, January 24
Davoss Conference (World Economic Forum Annual Meeting)
00:00 USD Richmond Fed Manufacturing Index
00:00 EUR Consumer Confidence
09:30 AUDEmployment Change & Unemployment Rate
◎ Weekly Schedule
