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USDJPY Tumbles, Drags Futures Lower, After BOJ Said To See "Little Immediate Need" For More QE
And it was going so well overnight: with the USDJPY surging as high as 120.25 overnight, before finding its prefered equilibrium spot at 120, the Yen carry was doing its centrally-planned and mandated job of supporting market... and then a Bloomberg headline yanked the carpet from underneath it:
- BOJ IS SAID TO SEE LITTLE IMMEDIATE NEED FOR ADDING STIMULUS
- BOJ OFFICIALS ARE SAID TO WANT CHANCE TO SEE MORE DATA
More details from Bloomberg:
Bank of Japan officials see little need for an immediate expansion of monetary stimulus and would prefer to hold off to get a clearer picture of the economic outlook, according to people familiar with their deliberations.
Board members who gather for Oct. 6-7 policy meeting want opportunity to observe further economic data and developments in financial markets at home and abroad, according to the people, who asked not to be named because talks are private
Needless to say this is a problem for liquidity-addicted algos: with the ECB last week making a solid case against more easing any time soon, all hopes were on the BOJ's October meeting to boost QE.
The BOJ, however, realized there are little incremental debt sellers that it can monetize debt from, as explained here on September 4 in "The IMF Just Confirmed The Nightmare Scenario For Central Banks Is Now In Play", and a result suddenly there is virtually nothing propping up the USDJPY which is about 200 pips rich relative to the Nikkei.
Which is why said most important carry trade for global risk markets, the USDJPY, suddenly took a 30 pip move lower, and dragged US equity futures down with it.
Because if the ECB won't boost QE, and the BOJ won't boost QE, and the Fed still pretending it will hike rates even as 6 out of 6 Fed surveys confirm the US economy is in a recession, just what is the upside catalyst again?
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Dow goes down 1000 points today!!! Please
Ye , please, I have puts on NKE and JNJ and need the new iPhone Plus S Six
Oct 2nd exp. I hope. So you long aapl?
This sucker is in- dee- structable.
Nothing hurts this market. Bad news, meh, buy the dip.
Greece,nah. Millions of broke immigrants, nah. China Credit problems, nah. Volkswagen huge recal, nah. 200 Trillion in unfunded liabilities, nah.
Backwards demographics, nope.
Asia is green arrows, Europe is green arrows.
The world is in the toilet, the markets rage on!
Been noticing an increase in layoffs lately- and at big companies. Not a tidal wave (yet), but clearly up significantly. This is what usually happens at the end of an economic expansion cycle.
Apple will pull back unless more QE, Nke goes back to $115 and jnj only needs to pull back $1 to make money in the puts ( hardly any Preimum in boring DOW stocks).
VXX put options move fast and furious! :)
I NEED MOAR DRUGS!!!! GIVE THEM TO MEEEE!!!!!!!!!!
You can blind fold them with dental floss!!
It's all Bullshit!!!
And if you like your Bullshit!!!, you can KEEP your Bullshit!
Dax 160 points reversal from today's high and now heading even lower
like the fire dept. saying the house fire is small, no need for water.
not sure why they would shoot themselves in the foot like that??
wait twenty minutes they'll say something different
Simmply a trial balloon
Will be followed by joint announcement of coordianted ultra-QE, and everything jumps up 5-6%
Whatever the case re the Yen, the FX markets in general were really thin and messy in September, dangerous trading with lots of spikes outof nowhere.
August was fine, good trading and plenty of liquidity so I don't know what happened to Sep when everyone was supposed to be back from the holidays.
How is Japan in the SDR?
BOJ is in Kamakazi mode. they're just resting for the finall all out assualt... remember "UNLIMITED amounts of money will be printed" Abe said
The Yen Carry trade will never be allowed to cease... Japan is the US's Prison Bitch on this one. .. hope the Pentagon dont mind me borrowing that turn of phrase.