Daily Alert – Tuesday 19th December 2023: BoJ gives mixed message, not good
The Bank of Japan managed to disappoint markets today at the rate-setting meeting. Despite Governor Ueda, earlier this month, suggesting a change in interest rate policy (i.e. hiking) was on the cards, there was no mention of this at the meeting. This had the exact opposite effect of his previous comments: the JPY fell like a stone and Japanese equities shot up. Slight messaging problem there, I think.
Elsewhere, Canadian year-on-year CPI stayed at last month’s figure of 3.1% instead of dropping to 2.9% as expected.
Oil continues to grind up despite the balancing effects of tankers being attacked in the Red Sea (threat to supply) and the rise of US shale oil production (a real supply increase). I don’t feel confident enough to trade WTI long and I am very keen to avoid my last trade of the year being loss-making.
I’ll be back tomorrow.
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