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On November 16, it was reported that Li Baian, former member of the Party Committee and Vice President of China Merchants Group Limited, is suspected of serious violations of discipline and law and is currently under disciplinary review and supervisory investigation by the Central Commission for Discipline Inspection and the National Supervisory Commission.On November 16th, according to the Finnish newspaper Helsingin Sanomat, European Central Bank (ECB) Governing Council member Rehn stated that the risk of slowing inflation should not be ignored. Low energy prices, a stronger euro, and declining wage and service sector inflation all suggest that overall inflation may be excessively below the ECBs 2% target. When asked if the ECB might cut interest rates again in December, Rehn said, "This risk cannot be underestimated." However, he also cautioned against the potential for rising inflation. Rehn stated that despite the Trump administrations tariff policies disrupting global trade, the Eurozone economy has shown resilience. Rehn also warned that the stock market "clearly faces the risk of a correction," emphasizing the importance of bank capital buffers. Driven by the US artificial intelligence boom, current stock prices appear high relative to the performance of the real economy and corporate profits. This requires caution.On November 16th, it was reported that the United States and Trinidad and Tobago are about to conduct military exercises in waters near the coast of Venezuelas Sucre state. On November 15th, Venezuelan President Maduro strongly condemned the exercises, calling the action "irresponsible" and a "threat" to peace in the Caribbean. Maduro stated that such actions are intended to put pressure on Venezuela, but Venezuela "will not be threatened by anyone." Recently, Trinidad and Tobagos Attorney General John Jeremy stated that the 22nd Marine Expeditionary Unit will be "intensifying exercises" in the country "in the coming days."1. Hungarian Prime Minister: Europe is on the brink of war. 2. Ukraine claims 1,200 Ukrainian prisoners will be released; Russia has not yet responded. 3. Russian Ministry of Defense: Russian troops have taken control of the Yablokovo settlement in Zaporizhia. 4. Ukrainian President Zelenskyy has ordered a comprehensive reform of state-owned energy companies. 5. According to RIA Novosti: The situation remains stable after an external power line to the Zaporizhia nuclear power plant was shut down. 6. Southern Ukrainian Defense Forces: Ukrainian troops have conducted a tactical withdrawal from the town of Novovasilivsk in the Zaporizhia region. 7. General Staff of the Armed Forces of Ukraine: A Russian oil refinery in Ryazan Oblast was attacked by Ukrainian forces; the refinery produces 840,000 tons of aviation fuel and other military fuels annually. 8. Russian Ministry of Defense: 247 Ukrainian drones were shot down in the past 24 hours. A Ukrainian military airport and energy facility related to the defense industry were attacked. 9. General Staff of the Armed Forces of Ukraine: Ukrainian forces struck the Sky-U radar station in Crimea, a military train in the Tokmok region of Zaporizhzhia, and a Russian troop assembly point in Volchansk, Kharkiv region.On November 16, the Kremlin announced that Russian President Vladimir Putin and Israeli Prime Minister Benjamin Netanyahu held a phone conversation on November 15, during which they had in-depth exchanges on the situation in the Middle East, including developments in the Gaza Strip, Irans nuclear program, and the situation in Syria.

AUD/JPY Establishes over 90.00 as RBA Favors Gradual Balance Sheet Easing Program

Alina Haynes

May 23, 2022 10:06

The AUD/JPY pair has showed a sharper upward move after being underwhelming in the early Tokyo session. The risk barometer stayed in a modest range of 90.18-90.44 and now has surged significantly to around 90.60 after Reserve Bank of Australia (RBA)’s Christopher Kent said that the central bank is in no haste to kick-start its balance sheet reduction operation.

 

The current spike in the price pressure caused the RBA to boost its interest rate by 25 basis points (bps) for the very first time since the Covid-19 epidemic in May’s monetary policy statement. The action was absolutely unexpected since the RBA did emphasize in its comments that the central bank is not seeing rate rises sooner.

 

As RBA has pushed up its rate cycle, the market investors started expecting that the RBA will also commence its balance sheet reduction program to speed up the inflation-controlling procedure. Now, the RBA has indicated that the central bank is in no mood to bank upon quantitatively easing forcefully.

 

RBA Christopher Kent ordered that the Bank would continue to be able to maintain effective control over the cash rate as it withdraws monetary policy stimulus in the term ahead,' as per Reuters.

 

Meanwhile, higher-than-anticipated inflation data in Tokyo are expected to limit the sheer quantity of stimulus packages supplied by the Bank of Japan (BOJ) to accelerate the growth rate. Annual Japan’s National Consumer Price Index (CPI) number at 2.5 percent , much higher than the expectations of 1.5 percent and the earlier print of 1.2. 

AUD/JPY

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