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On January 15, Xiao Sheng, Director of the Capital Account Management Department of the State Administration of Foreign Exchange, stated at a press conference held by the State Council Information Office that the State Administration of Foreign Exchange will orderly promote high-level institutional opening-up of capital accounts in areas such as direct investment, securities investment, and cross-border financing. The next step will be to further study and optimize relevant policies for Qualified Foreign Institutional Investors (QFII) and continue to orderly issue investment quotas for Qualified Domestic Institutional Investors (QDII).On January 15th, Yan Xiandong, Director of the Survey and Statistics Department of the Peoples Bank of China, stated that as of the end of November 2025, the outstanding loan balance for the "Five Major Financial Tasks" reached 107.7 trillion yuan, a year-on-year increase of 12.8%. The interest rate on newly issued loans was 0.42 percentage points lower than the same period last year, with the interest rate for newly issued loans in the technology sector at 2.81% and the interest rate for newly issued loans in the digital economy industry at 2.7%.On January 15, Yan Xiandong, Director of the Survey and Statistics Department of the Peoples Bank of China, stated at a press conference held by the State Council Information Office that by the end of 2025, the outstanding balance of RMB loans from financial institutions will increase by 6.4% year-on-year. If the impact of local government special bond replacement on loans is taken into account, the growth rate will be around 7%. The total new RMB loans for the year will reach 16.27 trillion yuan, indicating that the financial systems credit support for the real economy remains at a high level.On January 15th, Zou Lan, spokesperson and vice governor of the Peoples Bank of China (PBOC), stated at a press conference held by the State Council Information Office that the PBOC continues to improve policies and arrangements for the cross-border use of RMB, supports financial institutions in enriching and improving exchange rate hedging products, enhances the ability of foreign trade enterprises to cope with exchange rate fluctuations, and strengthens the resilience of the foreign exchange market. Currently, approximately 30% of foreign trade enterprises can largely avoid the impact of exchange rate fluctuations by using RMB for cross-border trade settlement. The proportion of foreign exchange hedging still conducted in foreign currencies has also risen to around 30%, allowing enterprises to lock in exchange rate costs in advance and avoid the impact of exchange rate fluctuations on production and operations. Overall, this means that approximately 60% of import and export trade is relatively unaffected by exchange rate changes. Moreover, with the continuous deepening of high-level institutional opening-up and the continuous improvement of financial services, this proportion is expected to continue to rise.The German DAX 30 index opened down 10.85 points, or 0.04%, at 25304.02 on Thursday, January 15th; the UK FTSE 100 index opened up 15.65 points, or 0.15%, at 10200.00; and the French CAC 40 index opened up 25.49 points, or 0.31%, at 8356.46. The Stoxx 50 index opened 38.85 points higher, or 0.65%, at 6043.90 on Thursday, January 15; the Italian FTSE MIB index opened 88.10 points higher, or 0.19%, at 45735.50 on Thursday, January 15; and the Spanish IBEX 35 index opened 2.43 points lower, or 0.01%, at 17693.27 on Thursday, January 15.

A decrease in the EUR/JPY exchange rate is about to occur as recession fears grow. It is now over 138.00

Alina Haynes

Jul 07, 2022 14:43

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The EUR/JPY currency pair is doing poorly during the Tokyo session. The cross is bouncing around a narrow range of 138.26-138.60 after recovering from its low of 137.27 on Wednesday. Generally speaking, bears are in charge of the asset. The pair has fallen during the last week as a result of failing to overcome the 144.00 resistance level, which has been a barrier for four weeks.

 

The chance of a recession in the eurozone has significantly increased as a result of the Bank of England's (BOE) negative assessment of the global economy. The BOE believes that price volatility in raw materials and energy might lead to economic disruptions in the future. The negative outlook of a Western central bank is fundamentally harmful to the FX market. The shocks to the economy would undoubtedly harm the eurozone as well because it forbids the import of Russian oil.

 

Along with fears of a recession, the common currency's bulls are also plagued by disputes over gas supplies between the economies of Europe and the United Kingdom. The British government has said that it would stop exporting gas to Europe if shortages develop there in the upcoming months.

 

The underperformance of the wage-price notion in Tokyo worries the Bank of Japan (BOJ). In order to keep inflation rates close to target levels, according to the BOJ, pay increases are required. If not, families would face greater price pressures, which would result in a decrease in the overall volume of demand.