05.07.2013

Asian markets have gained following dovish outlook coming from the European Central Bank and the Bank of England yesterday. The Japanese Bankers Association is to establish an independent monitoring body to promote transparency of the Tokyo interbank offered rate, or TIBOR. London and Singapore have led the way in reforms such as this, following the LIBOR scandal. China’s slowdown has sent ripples to Europe and other parts of the world due to lessening demand from the Chinese for raw materials, and in turn for a lower intake of foreign goods. The EUR/JPY was trading at 129.39 with a high of 129.62 and a low of 129.16 so far.

The NIKKEI closed at 14310.00 up 291.04 or 2.08%

Following the ECB and BoE rate meetings yesterday, where the base rates remained unchanged, EUR and GBP sold off following the announcements. Italian and Portuguese worries abound in Europe. Italy’s public deficit widened from 6.6% of GDP to 7.3% for the same time period last year. Portuguese government trouble, following resignations, has led to worries in the bond market. The resignations may give rise to an election, and the fear of instability has pushed up bond rates. The Bank of England’s new Governor, Mark Carney, sees policy going forward that will be in no rush to push bank rates higher. CABLE was trading at 1.5040 with a high of 1.5078 and a low of 1.5027 so far.

The FTSE100 closed at 6421.67 up 191.80 or 3.08% while the DAX closed at 7994.31 up 164.99 or 2.11%

Markets in the US were closed yesterday for a public holiday. Unemployment rates and Non-farm Payrolls are released today. EUR/USD was trading at 1.2890 with a high of 1.2916 and a low of 1.2883 so far.

Hope you all have a nice weekend.