Asian Markets In Turmoil - Weak Japanese Bond Auction; Surprise Aussie Rate Cut; India Holds Rates, Cuts Reserve Ratio

Tyler Durden's picture


India's Currency and Bonds are dumping...


UPDATE: Dow Futs -80 points, S&P Futs -9pts

Following the 15th surprise rate cut of 2015 (Singapore, Europe, Switzerland, Denmark, Canada, India, Turkey, Egypt, Romania, Peru, Albania, Uzbekistan and Pakistan, Russia and now Australia), the Aussie Dollar has cratered to its lowest since May 2009 against the US Dollar at 0.7650 (and bond yields crashed by the most since 1997 to record lows). Aussie stocks kneejerked higher (on an extremely dovish RBA statement) but are fading (as are Chinese stocks). Perhaps even more concerningly indicative of the central banks losing control, following this morning's weak Japanese auction (or more properly expressed - BoJ monetization farce), USDJPY (under 117), Japanese stocks (down 350 points from US session highs), and JGBs (yields up 6-8bps) are all being sold.

Rate cuts and dovish statement...

  • RBA says further fall in a$ likely to be needed to balance economy

And so...Aussie Dollar collapsed on the RBA surprise cut - biggest drop since June 2013


Dropping it to May 2009 lows...


Aussie Bond yields plunged by the most (on a percentage basis) since 1997...


Japanese stocks and USDJPY in trouble post-auction...


and more worryingly the BoJ is losing control of JGBs...


As Demand was very much absent:

  • JGB 10-Year Auction Draws Lowest Bid-to-Cover Ratio in 19 Mos.

Japan sold 2.191t yen ($18.69b) in 10-year govt bonds at average yield of 0.313%, up from 0.295% at prior auction on Jan. 6

Today’s sale draws bid-to-cover ratio of 2.68, lowest since July 2013, down from 3.42 at previous auction

Charts: Bloomberg

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Gnostech's picture

Ignore the man behind the QErtain

CrazyCooter's picture

You know what these central banks need?




Leveraged Algorithm's picture

This will be bullish for the S&P - up another 50 points at the close as central banks buy stocks.

disabledvet's picture

Gold in dollar terms is going through the roof right now.

"All money is worthless" near as I can tell.

James_Cole's picture

dow fut crashing before our very eyes!! Soon to be down -0!!! Forget an ambulance, call an undertaker, this shit DOA at bell!!

new game's picture

a least ten holes in the dyke. i know of ten fingers that are deployed. fed govs to the rescue. all fingers needed. cracks & fissures next. crumble ongoing. liquidity all sitting at the top 1 percent. maybe they got it wrong, huh. hey janet let it flow thru to the plebs. trickle down worked so swell in the reagan era...

Sisyphus's picture

LOL. ZH should update the update. Futures are all green now. As of 7:15 AM, +53, +7, +9.25; Dow, S&P and Nasdaq respectively.

Hitlery_4_Dictator's picture

I can not take it anymore with these sky are falling articles....7+ years and counting...please let this be it or just stop posting this shit. If it does not fail within a month ZH should jsut call it quits 

Wild Theories's picture

it won't fail in 1 month, or 10, or in 2020, or whatever

and the sky is still falling

GetZeeGold's picture



please let this be it or just stop posting this shit


Basically a trillion dollars a month propping everything up.....and you can't see this?


Here....have some Koolaid.

Wait What's picture

how bout you just stop reading? take your weak-little girly hands over to CNBS and cheerlead the status quo.

wouldn't that solve all your 'can't take it anymore' problems?

what a fucking pansy.

watching all these CBs capitulate... it's just starting to get fun.

Dead Canary's picture

His balls are made of pussy!

Ghordius's picture

they are not capitulating. they are engaged in a currency war. capitulating would be doing what Washington and the FED are asking since decades: not "manipulating" their own currencies, and leaving the steering wheel to the FED for the whole world

fact is that the FED sets the rates that can't be ignored. fact is that the strong dollar is nothing else then huge waves of USDs coming back home, or being sucked back to the US... and leaving what you get after a high tide: a low tide. fact is that it's an occasion that few non-FED-CBs can afford to ignore, besides the thing that they don't want to leave their "naked swimmers in the dry"

and this is reality, for the rest of the world... until the next huge wave of USDs will crash all over the globe

thegekko's picture

I suppose nobody ever thought the central planners could keep the party going this long, and in that respect ZH has a lot of very esteemed company. Eventually everything will go horribly pear shaped, in the meantime keep your eyes out for trading opportunities that are alluded to on ZH, like Goldman's call on lower oil last year(coincidence, I don't think so), and Jim Grant's call on CHF. And of course who can forget the infamous Tom Stolper, just do the opposite of whatever he says.

Plenty of great stuff on ZH, undoubtedly the best non-MSM financial wesbite in the world, possibly the best full stop.

Chicken_Little's picture

Who says the sky has to fall all at once? If it did I'd be out of a job.....

firstdivision's picture

I cannot take it anymore with these promises to kill yourself....7+ years and counting....please let this be it or just stop posting.  If you do not kill yourself within a month, H4D should just pay someone to kill you.

slaughterer's picture

Meh, US is awesome, rest of the world is a non-awesome anomaly. Bullard will tell us all this at 10am today and ES will go up another 20 handles. 

disabledvet's picture

The Fed might need to surprise the markets and RAISE interest rates actually. "To forestall the imminent bankruptcy of Illinois."

iclouding's picture
iclouding (not verified) Gnostech Feb 3, 2015 3:35 AM

I'm making over $7k a month working part time. I kept hearing other people tell me how much money they can make online so I decided to look into it. Well, it was all true and has totally changed my life. This is what I do...

new game's picture

i give blow jobs for 20 ea. to make 3000/month i need to make 100/day. easy to find 5 clean males that will pay for a blow job. want to join me because i know there are 10 or 15/day. my lips are chapped from the cold weather, but they like it rough. great career opp.  click now, early bird gets the worm-ha...

ebworthen's picture

"Roof!  Roof!"  Todo trying to get Dorothy's attention.

Tin Man with a surprised "O" face.

Spungo's picture

Unexpected rate cut... because it's super rare for central banks to cut interest rates when the economy is fucking horrible.

fed_depression's picture

This is the post of the week, LOL

1033eruth's picture

Its a SURPRISE if they don't jawbone it for a few meetings first.  Just how many sessions has our own Fed talked about a rate hike?  That's part of the ammo.  Jawboning, you have to squeek as much out of that as possible FIRST before actually doing anything.  

That was a major complaint about the Swiss depegging.  No jawbone notice.  Traders got caught with their pants down around the ankles and they don't like that. 

Mentaliusanything's picture

Yes It's a race to the bottom... Must make exchange rate lower, must lower interest rates, must goal seek risk assets and search for Higher and Higher returns, must lower wages, punish savers and the productive and reward the margin stealing Maggots.

Soon it will be time for Tarriffs on imports, closing the borders and stirrring animal spirits but only because the Shadow of the Crisis has Passed.

Talk about Paint your self into a corner... Thanks Mr and Mrsess Chairpersons, the smartest people on the planet.

You can smell the Urine/ ammonia in the Kiton K-50 suits.

TheMerryPrankster's picture

Driller Lariat Services laid off 265 people in the Permian Basin as it closes its divisional office, company officials confirmed Thursday, representing another sign of the downturn’s impact on jobs amid low oil prices.

“We’ve already got rid of them,” said Manuel Molinar, the Odessa-based operations manager of pulling unit services in the Permian Basin, saying the layoff notices given this week were to “all the departments. Lariat Services is shutting down in the Permian Basin.”

He referred further questions to corporate officials with Lariat’s parent company SandRidge Energy, an Oklahoma-based exploration and production company.

“It’s safe to say that both a steep contraction in crude oil prices and the downturn in the number of drilling rigs had a big impact on that decision,” said Jeffrey Wilson, the vice president for government and public affairs for SandRidge. “A $60 decline in the price of crude oil in the past six months weighs heavily.”

The regional oil price benchmark, Plains-West Texas Intermediate, ended at $41 on Thursday. That is


Green shoots everywhere

disabledvet's picture

Well...believe or not a drilling rig makes an EXCELLENT rocket launcher.

Now that the fuel is so cheap "might be raining golden nuggets soon in Texas."

I Write Code's picture

Oil rally is starting to look real.

Leveraged Algorithm's picture

Brought to you by your central bankers and their plung protection team....

GetZeeGold's picture



Cheap oil.....the one thing that could help people with 29.5 hr/wk jobs....they'll screw that up too. 


Pretty soon people will be forced to buy gas with their's the law. Ain't freedom cool?

Augustus's picture

At the JGB auction all that is needed is the one to one coverage by BOJ.

theliberalliberal's picture

<--  RBA Cuts Expected

<-- RBA Cuts Un-Expected

Obvoisly people werent watching A Current Affair last night.  Had a nice single mum and all talking about how every cent she will save from an RBA cut will help.  Doing the maths on how much you will save based on a mortgage of $X.    

They offered half a sentance from a Commonwealth Bank dude about low interest rates could cause a housing bubble in the future.  They purposely had a really low quality video of the guy as well as to psycologically discredit him to the viewers.

Not un-expected at all.  

Thank you RBA - every single Au ounce I have bought is now above water (in AUD terms).  

Now if only the Ag would catch up......

stay on target's picture

I concur... weeks ago the RBA has already communicated through unofficial channels that a rate cut is to be expected either in the Feb or March meeting.

theliberalliberal's picture

I went to CBA November last year to get money out of a cash account (superannuation) and roll it into a Self Managed Super Fund. (That was fucking pulling teeth I tell you).   Lady at bank "we can tell by this and that the rates are expected to rise. Suggest you lock in mortgage rates.  $20k of metal bought 20th November....up...up and away thank you very much.

Then speaking to young banker working for Macquarie during ski holiday in Niseko over new years.  "gold is going down".  Dont think so mate.  The bottom looks in in USD terms,  and definately in AUD terms. Couldnt grasp we are both australian, earning AUD.  if AUD gets cut from parity to 50cents like 6 years ago, then i wount be concerned about gold falling from $1200 to $1000 in USD terms (which it did not evidently).

litemine's picture

Glad to see someone who else can think for themselves. Protect your own, spread the word.

stay on target's picture

Gold will reach 2300-2500 aud if AUDUSD hits 0.50 mate (assuming the correlation is linear). Which is what I expect, just not sure about the timing. Actually, I won't be surprised AUDUSD hits 0.40 before we see the bottom.


aghhh I despise Glenn Stevens and his central banksters lot since I am paid in AUD at work.

thegekko's picture

AUD at 0.40, I don't think so. The low after the GFC was about 0.66, so can't see it going below that unless all hell breaks loose. Interestingly, our good Guvner thinks the Aussie is a bit overvalued right now, he must be smoking some good stuff.

fel.temp.reparatio's picture

Where were you last November when Ag hit a low of about AU$18 per Oz? ...and last week when it hit a high of about AU$23 per Oz? That's roughly a 27.5% increase in a little over 10 weeks - did you miss the 'golden' opportunity there?

theliberalliberal's picture

I'm not a leverage paper trader. My daughter will get her weight in Ag when she is 18 (unless she becomes a fatty).

My super fund is cash (digital it may be) and hard metal. Not one share atm. Might dip into a penny stock miner as they have just started producing finally. $800 aud cost per oz

My unencombered Ag is average mid 20s so some time before liquidation.

I suspect liquidation will start around aud/usd 0.60.

Compare gold (usd) / gold (Aud) peak timing last crash. No correlation at all. All exchange rate. Silver wasn't like this so not sure of my plan to sell that yet.

AssN9's picture

And gold goes straight to 1665 AUD in a heartbeat ;)

theliberalliberal's picture

Clipped 1685. $50 move in one day. Smells like lead up to last peak.

ClassicCommodity's picture

I envy you US posters. Try carrying depreciating AUD during the deflation when everything becomes "cheap". Well not for me lol. I'll be paying double for things like gold. Fuck you Americans!

IridiumRebel's picture

Buy a house in Perth. You'll be fine.

disabledvet's picture

Sellin out to China.

"We gotz our evil eye on u Down Under too." Tell New Zealand thanks for Peter Jackson tho. Looks like The Riders are out in full force.

Latitude25's picture

What?  You didn't already buy gold?  Have you been fuckin asleep for the past 7 years?

GetZeeGold's picture



Watching American Idle and worrying about deflated footballs.....what's this about gold?

JoJoJo's picture

India has lots of gold and high interest rate. india, as a money magnet, may look more solid the than the  U.S. after the jig is up. They can go for years without resorting to the punch bowl. We cant live a day without it.