Daily BriefsMacro

Macro: Nikkei 225’s Comeback and more

In today’s briefing:

  • Nikkei 225’s Comeback
  • Could the BoJ Be Saved?
  • UK: Inflation Loses Some Core Support
  • CX Daily: To Keep Stimulus Flowing, China’s Local Governments Need a Budget Fix

Nikkei 225’s Comeback

By Shyam Devani

  • Emerging trends and dynamics across international markets coupled with the BoJ’s policy are lining up to support the Nikkei 225
  • Historical comparisons, if correct, also indicate a strong bounce. The price action on the Nikkei 225 itself is also bullish.
  • At this stage in a volatile market we remain fixed on short term dynamics and refrain from longer term outlooks where conviction still neds to be built

Could the BoJ Be Saved?

By Shyam Devani

  • Japan is clearly worried about a weaker JPY despite the BoJ’s bond  market policy
  • Could they be saved by external factors – namely a calming down or even reversal of rising US yields?
  • Historical comparisons as well as developments in commodities and the economy suggests the answer could be yes

UK: Inflation Loses Some Core Support

By Phil Rush

  • UK CPI inflation matched forecasts by rising slightly to 9.1% amid relatively small offsetting surprises, although the RPI was more adversely affected and rose to 11.7%.
  • Strength in food and energy is masking an easing of core pressures under most definitions. It’s too early to say if that’s a genuine turn or a mere lull.
  • Inflation remains too high, even if it’s not matching BoE fears, so ongoing rate hikes are necessary. FX pressure is encouraging potentially inappropriate aggression from some.

CX Daily: To Keep Stimulus Flowing, China’s Local Governments Need a Budget Fix

By Caixin Global

  • In Depth: To keep stimulus flowing, China’s local governments need a budget fix

  • Police officers probed over handling of Tangshan women’s assault

  • Henan resident sues health authorities alleging health code abuse

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