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☆ Instant view: Incoming BOJ chief Ueda says current low rates appropriate
▼ + stars: | 2023-02-24 | by ( ) www.reuters.com time to read: +6 min

Feb 24 (Reuters) - Incoming Bank of Japan (BOJ) Governor Kazuo Ueda said on Friday it was appropriate to maintain ultra-loose monetary policy as inflation has yet to sustainably and steadily meet the central bank's 2% target. "I think he's intentionally doing that, so that the market will calm down a little bit about policy change expectations." "I don't think Ueda has the same stance as (Haruhiko) Kuroda but it is not clear whether Ueda would tweak the BOJ policy as the market expected." CHARU CHANANA, MARKET STRATEGIST, SAXO MARKETS, SINGAPORE"No surprises there, we expected Ueda to take it slow and he's starting off echoing Kuroda's views. He has been out of touch with the BOJ policy making since 2005 and will take time even if he was to consider policy normalisation at some stage."

☆ Morning Bid: War and PCE
▼ + stars: | 2023-02-24 | by ( ) www.reuters.com time to read: +4 min

A look at the day ahead in U.S. and global markets from Mike DolanWith world headlines focussed on first anniversary of Russia's invasion of Ukraine, the inflationary consequences that pounded world markets last year still smoulder. Curiously, the initial energy shock from the Ukraine war is already less of a problem than the change in pricing behaviour that it seeded - especially in services still distorted by the pandemic, in corporate margin building and rising wage settlements. But it's the pickup and stickiness in underlying "core" prices, excluding energy and food, that is irking the central banks and the Federal Reserve most of all. Alongside another tight U.S. weekly jobs report, markets got another glimpse of those price pressures on Thursday. And increasingly buoyed by the still intense geopolitical fallout from a year of the war in Ukraine, the dollar pushed higher yet again.

☆ Dollar steady on higher-for-longer rates outlook; yen volatile
▼ + stars: | 2023-02-24 | by ( Ankur Banerjee | ) www.reuters.com time to read: +3 min

SINGAPORE, Feb 24 (Reuters) - The dollar held firm on Friday as investors braced for U.S. interest rates to be higher for longer, while the yen was volatile, with incoming Bank of Japan Governor Kazuo Ueda saying it was appropriate to maintain an ultra-loose monetary policy. The yen was volatile on the day and swung between gains and losses against the dollar as investors parsed through the comments from Ueda, who was speaking at the lower house confirmation hearing. The recent spate of strong U.S. economic data and hawkish rhetoric from Fed officials have led the dollar to erase its year to date losses. The dollar index , which measures the U.S. currency against six other rivals, was up 0.019% at 104.580 and was set for a fourth straight week of gains. The euro was up 0.04% at $1.0599, while sterling was last trading at $1.2016, up 0.02% on the day.

☆ European markets set to open higher ahead of economic data releases
▼ + stars: | 2023-02-24 | by ( Jenni Reid | ) www.cnbc.com time to read: +2 min

European markets were set to open higher Friday, as investors prepare for data releases and more company earnings. A survey found British consumers have turned slightly more optimistic on their personal finances and the economic outlook. Releases later in the day will include U.S. data on personal income, new home sales and consumer spending. A poll of equity analysts published by Reuters on Thursday suggested global stock markets will continue to be volatile as market interest rate pricing moves higher. Asia-Pacific markets were mixed on Friday, with Chinese and Hong Kong indexes falling but Japan's Nikkei 225 climbing.

☆ Dollar retreats as investors come to terms with higher-for-longer U.S. rates
▼ + stars: | 2023-02-23 | by ( Rae Wee | ) www.reuters.com time to read: +2 min

Nearly all Fed policymakers favoured a scale down in the pace of interest rate hikes at the U.S. central bank's last policy meeting, minutes from the Jan. 31-Feb. 1 FOMC meeting showed on Wednesday. However, they also indicated curbing unacceptably high inflation would be the "key factor" in how much further rates need to rise. "Many central banks around the world ... are trying to put an emphasis in their determination to combat inflation expectations," said Christopher Wong, a currency strategist at OCBC. The kiwi continued to draw some support from the Reserve Bank of New Zealand's hawkish rate rise on Wednesday, after the central bank signalled further tightening ahead to tame high inflation. "The easy part of the short USD trade is over," said Galvin Chia, emerging markets strategist at NatWest Markets.

☆ Dollar firms as investors brace for higher-for-longer rates scenario
▼ + stars: | 2023-02-23 | by ( Rae Wee | ) www.reuters.com time to read: +3 min

However, they also indicated curbing unacceptably high inflation would be the "key factor" in how much further rates need to rise. The dollar paused its ascent on Thursday after gaining broadly on the back of the release. "The meeting minutes were pretty much within expectations ... the markets are now pricing for higher-for-longer rates," said Tina Teng, market analyst at CMC Markets. "The resilience (of the U.S. economy) prompts the Fed to keep raising interest rates ... pushing up the U.S. Against a basket of currencies, the U.S. dollar index stood at 104.50, and was attempting to break a more than one-month peak of 104.67 hit last week.

☆ Incoming BOJ chief Ueda to speak in parliament as yield cap comes under attack
▼ + stars: | 2023-02-23 | by ( Leika Kihara | ) www.reuters.com time to read: +3 min

[1/3] A general view shows a parliamentary session at the Lower House of Parliament in Tokyo, Japan November 10, 2021. In a column issued last July, Ueda warned against raising rates prematurely but said the BOJ must eventually consider how to exit its ultra-loose policy. The government's deputy governor nominees - former banking watchdog head Ryozo Himino and BOJ executive Shinichi Uchida - will testify in the afternoon after Ueda. The upper house of parliament will hold the confirmation hearing for Ueda on Monday, and that for the two deputies on Tuesday. Under YCC, the BOJ guides short-term interest rates at -0.1% and the 10-year bond yield around 0% as part of efforts to sustainably achieve its 2% inflation target.

All eyes on Friday - not just in Asia but around the world - will be fixed on Japan, specifically the latest inflation figures and the first of two parliamentary confirmation hearings from incoming Bank of Japan Governor Kazuo Ueda. The importance of Japan on global market flows and pricing cannot be overstated. Japan is the world's largest creditor nation and a chunk of the trillions of dollars Japanese investors have invested overseas could be repatriated if domestic monetary policy is tightened. Not only are the Fed and many other central banks raising interest rates, it finally looks like inflation has come to Japan. It could be a volatile end to the week for markets, with U.S. inflation figures for January also slated for release.

The economic calendar and market trading grind back into gear on Tuesday, kicking off in Asia with the flash Aussie and Japanese PMIs for February. chartManufacturing activity in Japan has contracted for three months in a row and service-sector activity has expanded for five months, meaning overall economic activity grew in January for the first time in three months. Services and overall business activity as measured by the PMIs have been contracting for four months. This may be a good time to deliver growth-boosting rate cuts or ramp up liquidity injections even more. Here are three key developments that could provide more direction to markets on Tuesday:- Japan flash PMIs (February)- Australia flash PMIs (February)- Reserve Bank of Australia policy meeting minutesBy Jamie McGeever; Editing by Josie KaoOur Standards: The Thomson Reuters Trust Principles.

☆ Take Five: A year of war in Ukraine
▼ + stars: | 2023-02-17 | by ( ) www.reuters.com time to read: +5 min

LONDON, Feb 17 (Reuters) - The coming week will mark a year since Russia invaded Ukraine. The war goes on, but the world, and the markets, are in a very different place from last February. 1/A YEAR OF WARSenior politicians and military leaders from around the globe meet in Germany this weekend, days before the anniversary on Feb. 24 of Russia's invasion of Ukraine - Europe's biggest conflict since World War Two. Moscow is ramping up its spring offensive, while Ukraine - armed with heavier and longer-range firepower from the West - gathers strength for a counter push. On the same day as the Ukraine anniversary - Feb. 24 - Ueda should offer clues on timing when he testifies with his two would-be deputies to the lower house.

Jan 27 (Reuters) - A look at the day ahead in Asian markets from Jamie McGeever. There are no major Asian economic indicators or corporate earnings releases on Friday to really drive market direction, and volumes will be relatively light due to China still being closed for Lunar New Year. Hong Kong's Hang Seng is open again after the Lunar New Year holiday, and its 2.37% surge to a 10-month high on Thursday was the regional standout. It's worth noting that this measure of annual inflation was negative for most of 2021 and only 0.2% a year ago. They do not reflect the views of Reuters News, which, under the Trust Principles, is committed to integrity, independence, and freedom from bias.

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