Global Market: "Acquaintance" Or Another Market Tsunami

The yen continued to soar, after the Bank of Japan decided to maintain monetary policy unchanged on Thursday. Despite weak global demand and a sharp rise in the yen, the market failed to boost stimulus measures against deflation.

China's National Bureau of statistics and the Federation of logistics and purchasing (CFLP) jointly announced on Sunday that China's official manufacturing PMI declined slightly to 50.1 in April, lower than the median forecast value of 50.4 and 50.2 last month, but for second consecutive months.

In addition, the RBA will meet on Tuesday to review policy.

Although it is widely expected that the Federal Reserve will maintain interest rates at a record low of 2%, some analysts still expect to cut interest rates.

Australia's consumer prices unexpectedly dropped in the 4 quarter of last year, and the important core inflation rate also dropped to a record low, far below the 2-3% target area of the RBA.

Commonwealth Foreign Exchange chief market analyst Omer Esiner said: "the trend is mainly influenced by the Bank of Japan. The central bank has decided many investors to be surprised," and the US dollar / yen may fall further to 105 yen in the next few weeks, as traders continue to dismiss the yen's "bearish" bet.

According to the latest report of Japan's Kyodo news on Sunday (May 1st), Japanese finance minister Taro Aso (Taro Aso) responded to the action taken by the United States to include Japan in the new foreign exchange policy watch list. He said that the US move would not inhibit Japan's actions in the foreign exchange market, and Japan would take action if necessary.

Taro Aso told the media before he went to Frankfurt to attend the Asian Development Bank meeting: "this will not limit our response to the fluctuations in the foreign exchange market.

At present, the yen is obviously a one-way speculative trend. We are very concerned that we will continue to pay close attention to the trend of the foreign exchange market so that speculative trend will not continue, and we will take measures if necessary. "

On Friday, the United States expressed concern about the economic policies of China, Japan, South Korea, Taiwan and Germany, mainly because they had huge trade surpluses with the United States and included these countries and regions in the latest observation list.

On other major currencies, preliminary data on Friday showed that the economic growth of the euro zone accelerated in the 1 quarter and was faster than expected, pushing up the euro.

In addition, data showed that inflation in the US did not increase in March, and the US dollar weakened because consumer spending was still weak.

US data reinforced the expectation that the US Federal Reserve (FED) might not rush to raise interest rates again, and the Fed's policy statement last Wednesday was interpreted as a dovish doer.

"The market does not expect the Federal Reserve to do too much, so there is some downward pressure on the US dollar," said Sireen Harajli, Mizuho Corporate Bank foreign exchange strategist.

In the first quarter, the economic experience is almost stagnant. The monthly employment report released by the United States next week will show whether the economy is back on track.

So far, the US job market has not received global worries and dollars.

Interference.

The US GDP growth in the 1 quarter was only 0.5% compared to the annual rate, suggesting that the quarterly growth rate was only about 0.12%, the weakest performance in two years.

Weak consumer spending, reduced inventories and investment by companies, and strong US dollar exports hurt the economy.

However

It remained strong, with 209 thousand jobs growth in the 1 quarter.

The mainstream market expects that the data released on Friday is expected to show that the number of non farm jobs in April will continue to increase by 200 thousand.

The US Federal Reserve (FED) has kept interest rates unchanged in the past week and kept the door open in June, but in view of the slowdown, the Fed is not in a hurry to tighten monetary policy further.

In March, the US core personal consumption expenditure (PCE) price index rose to 1.6% annually, limiting the probability of raising interest rates.

Salary growth is also weak.

But the strong performance of the job market may eventually become an incentive for the fed to act.

Harm Bandholz, chief U.S. analyst at UniCredit, Italy believes that the Federal Reserve will start in June, but it will depend on the pace of growth in household spending and the rebound in the economy.

"The underlying dynamics of the job market have not diminished. If the employment growth rate reaches 175 thousand or more, the Fed should believe that everything is working normally."

In Europe, the first quarter of the euro zone economy

It has been the highest in five years, benefiting from France and Spain, and surpassing the performance of the United States and Britain.

However, such excellent performance may be short-lived, and the euro zone in April is again in deflation.

1 years ago, the heavily indebted countries almost swept away from the euro zone will return to the horizon in the coming week.

The Greek government and international lenders are close to reaching agreement on a package of reforms and further contingency measures.

The relevant work is expected to end when the euro zone finance ministers' meeting is held in May 9th.

Will the debt be broken again, or will the country go bankrupt or eventually overcome the debt problem?

At the beginning of the month, market attention turned to economic forward-looking indicators. Market expectations for Monday's manufacturing PMI show that the euro zone's manufacturing activity grew slowly in April compared with the previous month.

The service industry PMI is also expected to show no significant acceleration compared with the previous one; in February, service industry PMI hit a 13 month low.