Asian Markets Advance
Japan’s GDP sent equities higher this morning. Reports showed that Japan’s GDP rose 0.2% in the fourth quarter of 2016. The growth derives from an increase in exports due to a weaker yen however, the data shows that domestic demand is lagging. Japan had a 1% GDP growth for 2016. This suggests that the Bank of Japan will not change its monetary policy in the near future.
- USDJPY is trading up 0.33%, trading at ¥113.55
- China A50 is up 0.28%, trading at ¥10472.50
- MSCI is up 0.3%, trading at ¥360
US Politics Shape Markets
Last week, Donald Trump promised a ‘’phenomenal’’ tax plan which sent the dollar lower, the dollar than rebounded at the latter half of the week. However, the greenback is now on a downward trend as uncertainties around Donald Trump prevail once again.
Daniel Tarullo, a top Federal Reserve official and a strong advocate for financial crisis safe-guards, such as the Dodd-Frank, announced his resignation last Friday. His departure leaves many regulatory questions un-answered. Additionally, Trump will appoint a new Fed governor who will take charge of financial regulation.
Fed Chair Janet Yellen speaks tomorrow. If Yellen hints at a rate hike in March, the dollar could rally.
Commodity Corner
Crude oil retracted after IHS Markit report showed that there were only 174 oil and gas discoveries worldwide in 2016. This suggests that there will be an increased reliance on other unconventional resources such as engineered fuels.
- Crude is down 0.63%, trading at $53.50
- Brent oil is down 0.6%, trading at $53.32
- Gold is also suffering a downward trend at $1230.65