Morning Call

S&P says there is more than a 33% chance of Japan being downgraded from AA- Scottish independence: Treasury says currency pact case 'not clear' - BBC News The 100¥ print has been eyed for some time as with the dramatic weakening of the Yen, however the USDJPY cross lost momentum around 99.85 UK PM Cameron says he will look at implementing tax breaks for fuel efficient cars and will block any further rises in duty on petrol Japan's economy…

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PBOC's Gang Yi: Likely to widen RMB trading band in the near future -MNI More than two-thirds of the Japanese public now believe domestic prices will rise in the coming year, a government survey showed Wednesday, reflecting how the aggressive anti-deflation policies of Prime Minister Shinzo Abe's government have started to take root in the minds of the people -WSJ China’s property rebound gathered pace in March as new home prices in the southern city of Guangzhou ju…

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On Monday afternoon at the Boston Marathon, there were two large explosions near the finish line, killing at least two people and injuring dozens more. These atrocities were caught on camera via the media who covering the sporting event. Initially there was rumour and speculation as to the cause or who might be responsible however it seems too early to speculate without fact. The FBI has taken over the investigation into the explosions, with social media having a notable part in the rapid re…

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Nearly one in five UK companies favour leaving the EU - Bloomberg The Bank of Japan raised its assessment of all its regions for the first time since July 2012, citing a pickup in the global economy and resilient domestic demand, after unveiling unprecedented easing measures earlier this month - Bloomberg Gold and Silver continue their declines, spot Silver trading $24.50 and spot Gold traded as low as $1424.90/oz Dutch retail sales were down 4.8% YoY for February UK…

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Trading yesterday in the UK had little macro news to drive markets, with the media focusing on the passing on first female Prime Minister of the UK. Thatcher was a controversial character, who in the City of London is usually revered and hailed for reviving the UK economy, but her policies were not without critics, especially from those who lived in communities with an industrial/mining focus. The media is awash with opinion pieces from all parts of the political spectrum, but there is…

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The US employment report Nonfarm payrolls, disappointed with a huge miss of expectations (+200K), with the actual release being just 88,000 new jobs. This is the largest miss from the median expectations since December 2009. This has led to strength in cable with a rally of 100 pips, currently trading with a 1.53 handle, and EURUSD trading 45 pips higher at 1.2992.…

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The pivotal monthly US employment release Nonfarm Payrolls is released this afternoon at 13:30 (London). The statistic is usually released on the first Friday of each month, detailing the total number of US citizens who are in paid work, excluding: -Farm employees (due to seasonal nature of employment) -Employees of non-profit organisations -General government employees US Non-Farm Payrolls can be the most volatile monthly release of macro data. The volatility will w…

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The Bank of England held its benchmark interest rate at the 4 year low of 0.5% as expected. Prior to the announcement out of the 70 economists surveyed all expected for the rate to be left unchanged. The cenral banks asset purchase facility (QE) was also left unchanged at the current total of £375bn. No statement accompanied the release.…

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Uncertainty is something that investors will attempt to avoid at all costs. Political instability, verging on a nuclear war could cause a major shift of assets into safe havens. If the current words escalate, there is a real threat of something far more worrying to occur. North Korea has increased tensions, by threatening the US with a nuclear strike. The US realises that this the state poses potential danger and has deployed a missile launcher in Guam - Guardian More than half of all…

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Cypriot capital controls are weighing on markets this morning. The draconian measures have been put in place, to slow the pending bank run, as investors attempt to pull assets from the crippled Cypriot financial system. Individual accounts with balances below €100,000 will be “unaffected” by the haircut, however with large balances expected to receive significant haircuts, funds are expected to exit the country. The mood is reported to be hostile in Cyprus, as residents feel…

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Cypriot capital controls will be in place for 7 days, starting Thursday and apply to all accounts irrespective of currency or if the bank is part of the bailout agreements: Suspension of cashing cheques, allow check deposits All card transactions are capped at €5,000 per person, per month A ban has been imposed on leaving the country with more than €3,000 per person Interestingly an exception is for student tuition payments, though these are payments which h…

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Dijsselbloem, the Chair of the Eurogroup set the markets into free-fall, after stating that the Cypriot bailout was a “template for other Euro-area bailouts.” This comment of the Cypriot agreement being a precedent for future bailouts sent European bank shares crashing. However over the last 48 hours, hindsight has led to considerable backtracking by EU officials that in fact the Cypriot programme isn’t a template (Bloomberg). The losses the haircut on deposits could…

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The chair of the Eurogroup meetings, Jeroen Dijsselbloem, spooked markets with comments that the last-minute bailout of Cyprus set a precedent for any future interventions. The so-called bail-in of individual savers has been met my disbelief of many, after the move that was supposed to help Cyprus, send shockwaves through Europe. The unprecedented move led many to quickly draw parallels between Cyprus and other EU countries (PIGS), though EU official’s continuously stated that Cyprus w…

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