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Forex Flash: Yields signaling end of bull market in Japan? – Deutsche Bank

FXstreet.com (Barcelona) - The recent price action in JGBs is probably worth tracking given the recent extreme policy changes there. The 10-year yield started the year at 0.79%, fell to a low 0.44% soon after the BoJ announcement and is now back up at 0.79%.

According to Macro Strategy Analysts J. Reid and C. Tan at Deutsche Bank, “Every time yields sell-off fairly sharply there are the clarion calls suggesting that this is marking the end of the very long bull market. On all occasions so far they've been premature with most core markets at or very close to their all-time yield lows only a couple of weeks back.”

The dilemma we have is that we know that one of these sell-off are likely to be the real thing and the start of a march higher in yields. Such a scenario is inevitable from these levels and with all this global money printing. However, “we're not convinced that this is the start. There seems to be too much money sloshing around the system at the moment for this to be a sustained bear market. For now we think that yields will generally find a ceiling not too far above these levels and then range trade for the foreseeable future.”

Forex: NZD/USD cannot hold 0.8300 level, eases off highs

The NZD/USD has been entrenched in positive territory, attempting to rebound after an ugly start of the week yesterday. With the pair moving steadfastly towards the 0.8300 barrier Tuesday, the rally was capped at the 0.8303 (intraday high), whereby proving unstable at this region. Since then, the pair has eased back to 0.8280/83, still up +0.35% thus far during European trading.
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Forex: EUR/SEK in highs after Swedish CPI

The Swedish krona is quickly losing ground against its European counterpart on Tuesday, after consumer prices in the Nordic economy contracted further during April. The CPI dropped 0.2% on a monthly basis and...
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