tirsdag den 17. april 2007

JPY is the turn upon us?

Consumer confidence coming back, Government upgraded consumption 1st time in 20 month, only...aber dabei being the exepcted lowering of CPI forecast from 0.5 to 0.1%... Seems agreement consumer key for future path...

5 yr Japanese Rates...

This is growing risk for JPY bears - add to this we have big shift in bias from SHORT JPY to neutral... I am beginning to believe in the JPY from here.. but I am merely farmers son from Denmark...

There is already major change in rate differentials. Below I plotted JPY 1yr fwd vs USD 1yr fwd....It also indicates top could be in place.. last few hours there has even been, wrongly, rumors that BOJ may hike earlier based on better outlook.

Note the big drop in the white line, which, non-tested, seems to lead the USDJPY relationship.

Finally, there is must read for people concerned about Stagflation:

Caroline Baum, Bloomberg: http://www.bloomberg.com/apps/news?pid=newsarchive&sid=ak6GESHlmjp0

Good luck,

Steen Jakobsen

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