Tokyo fly with the decisions of the BoJ. Bags positive view of the Fed – The Republic

the MILAN - The central Bank of Japan has surprised the markets reviewed the purpose of his action: the governor Haruhiko Kuroda has decided to confirm the reference rate at -0,1%, the expansionary monetary policy to bring inflation to 2%, but has changed the framework within which it moves. From a target stimulus – in the jargon, we speak of “expansion of the monetary base” – the BoJ has moved toward a goal of control of the yield curve. In fact, it will select the securities to buy in his Quantitative easing to ensure the maintenance of current levels of performance, with the death of the rising sun around the zero. Because of this need, the indication of the objective of expansion of the monetary base (and therefore the acquired on the market, initially listed to 80 thousand billion yen per year) can vary in the short term to calibrate better shopping.

This position, waiting to understand in the Italian evening what will the Fed, he did squirt up the market of Tokyo, and depreciated the yen, while yields of ten-year of the rising sun have arrived to make zero for the first time since march last year. The Tokyo Stock exchange has closed this morning with an increase of 1.91% 16.807,62 points. The securities of the financial sector have been the subject of large purchases immediately after the announcement, as the BoJ has not decided to bring the rates in the territory to further the negative, a move that would have limited the profitability of the banks. Also the european markets are dealing in the rise, driven by the recovery of oil. the Milan close up of 0,88% after be came to earn in the course of the day more than 1.5%, Frankfurt added 0.41%, Paris 0.48% London advance of 0,06%. Positive even the Wall Street: when you close the trading in Europe, the Dow Jones rises by 0.3% as the S&P500, while the Nasdaq added 0.2%. At Piazza Affari bounce off the banks with the Mps, who yesterday had updated to the new minimum going below 20 cents of value: the title also passes by an auction of volatility, this time to the upside.

The trend of yields on the bonds of ten-year japanese in the last year

The strategist for Rbs in Singapore, Mansoor Mohi-uddin explains to Bloomberg the meaning of the move of the BoJ: “The central Bank has left open the door to more sagging in the future.” but for the moment it has not put further at risk the profitability of financial institutions by bringing rates more into negative. “With the new frame action, will be able to afford further rate cuts in the future, but mitigate the negative effect on the profits of financial institutions.” As to the reaction of the price lists, “goes hand in hand with what we have seen in America over the last few months and confirmation, as the Bags are driven by capital flows in or out depending on the expectations about future moves of monetary policy. Everything that sees the maintenance of low interest rates or more expansive monetary policies, is in favour of the lift of the Stock exchange, all that suggests the inflexibility of monetary policy, is contrary to it”, summarizes in a note on Matthew Paganini FXCM Italia.

If the decision of Tokyo has surprised, we do not expect twists on the outcome of one of the Federal Reserve, which has on the table the second rate hike since last December, which was missing from back in 2006. Only two out of the 102 economists of the panel of Bloomberg they believe that Janet Yellen will move the cost of money: for all the other it is rather to glean any clues on the timing of the next rallies, that for today there won’t be.

euro: closes below the level of 1,12 to 1,1148 dollars and 112,32 yen. The greenback retreats instead to 100,73 yen. The spreads between Btps and German Bunds has recently moved to 127 basis points, with the ten-year Italian that makes 1.27% on the secondary market.

As mentioned, on the front of raw materials stands out as the increase of quotations of the oil on the rise: in Europe when the markets start to go to the closing, the Brent is to 46,5 dollars / barrel with a growth of 1.3% and Wti squirts of 3% above 45 dollars per barrel. To sustain prices, from the Usa comes, in fact, the decline in the surprise oil inventories in the week ended September 16 fell to 6.2 million units in the 504,598 million, while analysts were waiting for a rise of 3.3 million barrels, after the descent of 559.000. Price ofgold a slight increase: the precious metal is being traded to 1,320,67 per ounce, marking an increase of 0.4%.