Breaking News
0
Ad-Free Version. Upgrade your Investing.com experience. Save up to 40% More details

Brazil’s Spending Cuts, BoJ On Hold

By Swissquote Bank LtdMarket OverviewSep 15, 2015 07:00AM ET
www.investing.com/analysis/brazil%EF%BF%BD%EF%BF%BD%EF%BF%BDs-government-plans-to-cut-spending-in-2016,-boj-on-hold-265097
Brazil’s Spending Cuts, BoJ On Hold
By Swissquote Bank Ltd   |  Sep 15, 2015 07:00AM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 

Market Brief

USD/JPY was trading substantially higher in early Asian session amid speculations concerning the expansion on the quantitative easing program by the Bank of Japan. However, Governor Kuroda announced that the BoJ will maintain the stimulus at ¥80tn per year despite a weak inflation outlook and anemic growth. We think it’s only a matter of time before the BoJ increases the size of the stimulus with October being our best guess. As a result of the comment, USD/JPY lost previous gains and quickly returned to ¥120. The pair is trading right in the middle of its short-term range, between the resistance and support lying at 121.75 and 118.61, respectively. The Nikkei is up 0.80%, while the broader TOPIX index rose 0.34%.

In Australia, the minutes from the RBA’s September meeting triggered a mini Aussie sell-off. AUD/USD fell 0.60% to $0.7110 as the Central bank declared that “international economic developments had increased the downside risks to the outlook, but it was too early to assess the extent to which this would materially alter the forecast for GDP growth in Australia's trading partners to be around average over the next couple of years”. The S&P/ASX fell 1.53% as iron prices remain under pressure. January futures are down more than 2% today and 4.70% from last week’s peak.

Elsewhere, Chinese mainland shares are extending losses for the second straight day. The Shanghai Composite is down 2.47%, while the Shenzhen Composite printed a 7-month low at 1,575.95, down 3.18% on the session. In South Korea the local gauge edges higher by 0.14% while in Hong Kong, the Hang Seng declines -0.27%.

Overnight, the US dollar gained ground against most G10 currencies. EUR/USD is back around 1.13 after testing the resistance lying at 1.1368 (Fib 38.2% on July-August rally) and is heading to the support standing at 1.1262 (Fib 50%). GBP/USD is also taking a breather after the previous day’s strong gains; the pair is under pressure this morning ahead of August’s inflation report. A support can be found at 1.5373 (September 14th low), then 1.5339 (September 10th low).

In Brazil, in the wake of Brazil’s credit downgrade to junk, Joachim Levy has proposed a new round of austerity measures aimed at cutting expenses and raising taxes. Dilma Rousseff’s government hopes to trim BRL 26bn of expenses in 2016 while increasing tax revenue by BRL 28bn. As a result, the BRL appreciated 1.61% against the EUR and 1.45% against the USD. This downgrade by S&P is a blessing for Joachim Levy as it will help to convince lawmakers and will sweeten the pill of austerity for Brazilian people.

Today traders will be watching current account balance from South Africa; inflation report (CPI and PPI) from UK; ZEW survey from Germany; retail sales, empire manufacturing, industrial production and capacity utilization from the US; tax collection and formal creation from Brazil.

Today's Calendar
Today's Calendar

Currency Tech

EUR/USD
R 2: 1.1714
R 1: 1.1438
CURRENT: 1.1301
S 1: 1.1017
S 2: 1.0809

GBP/USD
R 2: 1.5819
R 1: 1.5628
CURRENT: 1.5427
S 1: 1.5346
S 2: 1.5165

USD/JPY
R 2: 125.86
R 1: 121.75
CURRENT: 119.74
S 1: 118.61
S 2: 116.18

USD/CHF
R 2: 1.0240
R 1: 0.9903
CURRENT: 0.9696
S 1: 0.9513
S 2: 0.9259

Brazil’s Spending Cuts, BoJ On Hold
 

Related Articles

Marc Chandler
Central Bank Fest On Tap By Marc Chandler - Sep 19, 2021 1

In terms of central bank meetings, the week ahead is one of the busiest. No fewer than 13 central banks hold policy meetings, divided between six major and seven emerging markets....

Brazil’s Spending Cuts, BoJ On Hold

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
or
Sign up with Email