29.07.13

Bank of Japan’s Governor, Haruhiko Kuroda, says that a hike in sales tax will not hurt the Japanese economy and that the increase in taxes is needed to rebuild public finances. Japan’s target of 2% inflation still has not been reached. China’s State Council has ordered an audit on all government debt, showing that Chinese debt levels could be a concern for the Government. This follows a one day interest rate spike to nearly 25% in late June of this year, which was put down to shadow banking lending practice. USD/JPY was trading at 98.01 with a high of 98.34 and a low of 97.62 so far.

The NIKKEI closed at 13661.10 down 468.85 points or minus 3.32%

United Kingdom mortgage and consumer credit figures are released today, lending is expected to be up from GBP300 million to GBP 650 million, while consumer credit is expected to be repeated at GBP 700 million. Barclays, Deutsche Bank, UBS and Banco Santander will report second quarter earnings tomorrow. The European Central Bank will meet this Thursday, as will the Bank of England. Rates are expected to remain unchanged. CABLE was trading at 1.5370 with a high of 1.5403 and a low of 1.5365 so far.

The FTSE100 closed at 6589.11 up 34.32 or 0.52% while the DAX closed at 8298.43 up 53.52 or 0.65%

The FOMC meet this Wednesday, and the rate is expected to remain unchanged. The bond buying programme the FED has been supporting continues to be a major topic for discussion and the issue of when the tapering will begin is a source of constant point of interest. Non-farm payroll figures will be out on Friday, and the unemployment rate in the US is expected to drop slightly, from 7.6% to 7.5% EUR/USD was trading at 1.3267 with a high of 1.3293 and a low of 1.3260 so far.

The DOW closed at 15558.80 up 3.22 points or 0.02%

Have a nice day.