Report
EUR 23.10
For Business Accounts Only
http://track.com/articles/the-weekly-track-all-holidays/
Welcome to the end of 2016. The markets are thin and obsessed with China and Japan as they are the only places seemingly working and doing much business. Weaker Japan CPI inspired the doves to sell JPY with USD up for the first time in 5 days. Better China industrial profits helped Monday but not Tuesday, leaving markets watching politcs with more debt-for-equity swaps, more bond forgery stories, more tinkering with outward bound investment policy. The focus on the Xi comments about growth below 6.5% being acceptable seems to matter to how all markets plot out the path for 2017. The month-end flows ahead are likely to make the price action more choppy and full of noise than any one holiday dinner or party but when you mix illiquidity with doubt you get trouble and less fun. The dysfunctional qualities of news with out much analysis against the desires for window dressing the year-end returns and setting up for a nice picture of peace and prosperity for the year-ahead.
The battle for markets maybe best encapsulated in the relationship of the USD to China with the CNH watching 7.00 and a larger defense as capital outflows link to fears of depreciation and spark more US protectionism. Consensus is for CNY to run to 7.20 and higher in 2017 early tracking each US rate hike. The relationship to the JPY and other currencies also can’t be ignored and the painful balancing act for markets makes the holiday season seem more like a half-time break than a full vacation.
The Weekly Track all-holidays
- The Weekly Track – All Holidays by Bob Savagehttp://track.com/articles/the-weekly-track-all-holidays/
Welcome to the end of 2016. The markets are thin and obsessed with China and Japan as they are the only places seemingly working and doing much business. Weaker Japan CPI inspired the doves to sell JPY with USD up for the first time in 5 days. Better China industrial profits helped Monday but not Tuesday, leaving markets watching politcs with more debt-for-equity swaps, more bond forgery stories, more tinkering with outward bound investment policy. The focus on the Xi comments about growth below 6.5% being acceptable seems to matter to how all markets plot out the path for 2017. The month-end flows ahead are likely to make the price action more choppy and full of noise than any one holiday dinner or party but when you mix illiquidity with doubt you get trouble and less fun. The dysfunctional qualities of news with out much analysis against the desires for window dressing the year-end returns and setting up for a nice picture of peace and prosperity for the year-ahead.
The battle for markets maybe best encapsulated in the relationship of the USD to China with the CNH watching 7.00 and a larger defense as capital outflows link to fears of depreciation and spark more US protectionism. Consensus is for CNY to run to 7.20 and higher in 2017 early tracking each US rate hike. The relationship to the JPY and other currencies also can’t be ignored and the painful balancing act for markets makes the holiday season seem more like a half-time break than a full vacation.
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Robert Savage
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