Posts Tagged ‘ Federal Reserve ’

Dollar’s upside capped at ¥95 level | The Japan Times

Without a clear policy from both sides, FED on wether it will start to taper QE and when . then from Abe on his policy on his 3 arrow . Abe will do nothing until the election is over .

Until then 95 will be the norm , but personally I see the USD strengthening in the short term ,commodities weakening also .

Tony Evans

Dollar's upside capped at ¥95 level | The Japan Times.

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Could the Yen start to strengthen again ?

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This morning I watched the yen climbing against all major currency in reaction to the Japan’s Economy Minister Akira Amari said a even weaker yen would harm the economy and the people.

I believe the strengthening of the Yen was based on this but also on reaction of North Korea missile launch . The Nikkei continued its advances just showing that they didn’t take notice of the Yen strengthening .

The morning saw the Yen strengthening as much as 1.1%, then calming down ti 0.4% pat 102.86 per $ .Considering the Yen touched 103.31 on Friday , was I surprised ? No as this was simple profit taking .

With the USA economy strengthening and know the Federal Reserve talking about the reduction of quantitative easing , things are looking positive as the dollar the advantage from the perspective of fundamentals . Fed Chairman Ben S. Bernanke is scheduled to speak to the Joint Economic Committee of Congress on May 22. Minutes of the Fed’s last policy meeting will be released the same day.

This could be the end of the $85billion a month stimulus .But considering that Japan just started its stimulus this could have a positive effect on Yen ( if you of the opinion a weaker yen is positive ) as then the Yen will becoming the carry trade again . Looking at this 110/120 is very likely .

So No I cant see the yen strengthening I can actually see it weakening by another 10/20% .Abenomics has unleashed a wave of cheap money and I cant see them able to control this genie they released , but it is creating a positive buzz and that’s all it needed to do .

Tony Evans
Tokyo

http://www.bloomberg.com/news/2013-05-19/yen-climbs-as-japan-signals-negative-impact-from-further-losses.html

Gold Bubble – about to Burst ?

I have been saying Gold has been in a bubble for around 2 years . Gold increased in value on the basis of uncertainity in the market , but with s a stronger U.S. economy helps increase interest rates and cut Gold demand .

Why would you invest ?

My personal opinion I haven’t seen clients raising their holdings because inflation has remained low, the USA economy is improving and may spur the Federal
Reserve
to holt stimulus and the dollar has strengthened, the bank said
today in a report. Bullion is down nearly 5% this year .I can see gold going towards $1300 in the near term and looking at $1200 by year end

Billionaire investor George Soros, who called gold the “ultimate asset bubble” in 2010, cut his stake in the biggest gold exchange-traded product by 55%.

When you have people like Soros selling you know its a good sign , time to take profits and invest in the market .

http://www.bloomberg.com/news/2013-04-02/gold-bubble-seen-turning-to-bear-market-by-socgen-on-recovery.html

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China’s growth could slow sharply by 2030 – Fed

Reading the below article and there’s one point that stuck with me , GDP is man made ! After living in Shanghai for a period I saw that a “great deal” of things are fake and it’s a given that the population is not correct as funding was based on population .I believe that 10/15% variable is conservative overstated .

But at the current rate China generates GDP growth in a week equivalent to Cyprus yearly GDP & 12.5 weeks GPP growth of Greece !!

China might be slowing but it’s still growing !

China's growth could slow sharply by 2030 – Fed.

China’s growth could slow sharply by 2030 – Fed

The US Federal Reserve believes that global economic trends might shift sharply by 2030, as China faces mounting headwinds – potentially forcing it to fade dramatically in the years ahead.

Declining productivity and an aging population could shrink the trend growth in China to around 6.5% by 2030, according to a new study. Moreover, if the current forces that are undermining economic activity combine in a worst-case scenario, the pace could fall to under 1%.

Notably, one of the Fed’s Senior Adviser wrote that GDP growth rate is the sum of the growth in employment and the growth in output per employee, and China faces challenges in both of these categories. Meanwhile, a US diplomatic cable recently released by Wikileaks has shown that Li Keqiang, China’s new premier, called the GDP figures ‘man-made’ and therefore unreliable as they underestimate inflation.

Chinese economic data is often questioned by sceptics who believe that government statisticians refine the numbers to make the Communist Party look like it’s bringing prosperity to its citizens.

Nonetheless, in the midst of the financial crisis, buoyant Chinese growth helped to support the global economy after recessions in the United States and Europe.

Economists commented that most investors would agree that the Chinese economy cannot maintain the extremely rapid growth rates it has seen over the past decades. The question is thus not whether the Chinese economy will slow but by when and by how much.

If you are looking for impartial and up-to-date professioanl financial advice about international investment funds, speak to a deVere Financial Adviser for a whole-of-market approach.

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