Message-ID: <30181972.1075861037116.JavaMail.evans@thyme> Date: Wed, 23 Jan 2002 16:24:01 -0800 (PST) From: info@forexnews.com To: sara.shackleton@enron.com Subject: Japanese Preview Mime-Version: 1.0 Content-Type: text/plain; charset=us-ascii Content-Transfer-Encoding: quoted-printable X-From: @ENRON X-To: Shackleton, Sara X-cc: X-bcc: X-Folder: \Sara_Shackleton_Mar2002\Shackleton, Sara\Deleted Items X-Origin: Shackleton-S X-FileName: sshackl (Non-Privileged).pst [IMAGE] Forums Discuss these points in the Forums: Forexnews Forum T= echnicals Live Charts Analysis available from: Cornelius Luca J.P. Chorek= Technical Research Ltd. Charts & News featuring Standard & Poor's = Interest Rates US: Japan: Eurozone: UK: Switzerland: 1.75% 0.15% 3.= 25% 4.0% 1.25-2.25% [IMAGE] =09 [IMAGE] Japanese Forex Trading = Preview January 23, 7:00 PM: EUR/$..0.8777 $/JPY..134.47 GBP/$..1.4245 $/C= HF..1.6695 Japanese Forex Trading Preview by Darko Pavlovic At 6:50 PM J= apan Dec customs cleared surplus (exp n/f, prev n/a) USD/JPY is trading ar= ound 134.45 near its fresh three-year highs of 134.63 after Japanese and US= officials did not strongly object to weak yen, prompting market expectatio= ns that Tokyo plans to use weak currency to boost exports and bring the eco= nomy out of current slump. Traders look to break important psychological re= sistance at 135 yen but wary of possible comments from Fed Chairman Greensp= an tomorrow.US Treasury Secretary O'Neill's comments overnight that only st= ructural reforms, and not currency depreciation, would solve the Japanese b= anking quandary and increase productivity send the yen to a three year lows= . O'Neill added that he does not believe Japan was deliberately weakening t= he yen. Nonetheless, analysts interpreted his comments to mean that the US = would be tolerant of a weaker yen. Despite MoF Mizoguchi's denials that nei= ther O'Neill or Shiokawa approved of yen weakness in their meeting, investo= rs sold the yen as Finance Minister Shiokawa, Economics Minister Takenaka a= nd Prime Minister Koizumi all reiterated that FX rates should be determined= by markets. In addition, the MoF's Kuroda stressed that Japan did not inte= nd to drive the yen down, though he suggested that a weak yen, which is ref= lective of Japan's poor economy, could help the situation. Kuroda also brus= hed aside concerns from Japan's Asian neighbors that the yen's depreciation= would negatively impact their economies because they have more flexible ex= change rate policies and stronger foreign reserve positions following the 1= 997-1998 Asian financial crisis. Japan's customs cleared trade surplus fell= 18.4% in December from a year earlier, to 667.2 bln yen. Japan's surplus w= ith the US (its largest trading partner) was down 23.6% y/y to 526.9 bln ye= n. The trade surplus for the 2001 fell 38.3% from the previous year at 6.61= 15 trln yen, a third consecutive year of decline. Resistance is eyed at 134= .63, 135.0 and 135.50. Support holds at 133.60, backed by 133.0 and 132.60.= EUR/USD is trading near its one month lows of 87.80 after European Centr= al Bank president Duisenberg's testimony before the EU's Economic and Monet= ary Affairs Committee suggested that a rate cut in the foreseeable future i= s unlikely. He further noted that the recent decline in confidence may have= bottomed out. Duisenberg also had the temerity to say that he was uncertai= n that a US recovery would be quicker than one in the Eurozone, because whi= le the Federal Reserve cut interest rates faster than the ECB, the US rates= were higher from the outset. He remarked that monetary policy could impact= growth in the short-run but not in the long run, and thus reiterated that = the current level of ECB rates is considered appropriate. Support seen at 8= 7.70 and 87.50-- the 31.8% Fibonacci retracement of the move from 82.25 to = 95.96. Resistance is viewed at 88.90, followed by 89.10-- the 50% Fibonacci= retracement of the same move, and 89.55. The pound slightly recovered at = 1.4232 after falling to a 1-1/2 month low of 1.4222 against the dollar and= to a 2-week low of .6213 against the euro, weighed by weak data and commen= ts from an official indicating her support for euro membership. The UK trad= e deficit widened to 2.84 bln pounds in November from the previous month's = deficit of 2.39 bln. Furthermore, the Confederation of British Industry not= ed in a quarterly survey that manufacturing output was declining at its fas= test pace in 2-1/2 years and thus called on the Bank of England to enact an= other rate cut. The pound was hurt after British Trade and Industry Secreta= ry Patricia Hewitt commented on the benefits of joining the euro, including= currency stability and cost transparency. Moreover, she expressed the opin= ion that there is something fundamentally wrong in the current euro/pound e= xchange rate when highly productive manufacturing plants were struggling to= export profitably to the Eurozone. Support at 1.4221-- the 61.8% Fibonacci= retracement of the move from the January 8, 2001 high of 1.5101 to the Jun= e 12, 2001 low of 1.3680. Next downward target is seen at 1.420 and 1.4160.= Upside capped at 1.430, 1.4360 and 1.440.a small chance of a rate cut at t= he Jan 30 meeting, leaving the majority to believe rates will be held stead= y at a 40-year low of 1.75%. The National Association of Manufacturers tod= ay praised US Treasury O'Neill in his remarks yesterday when he said that c= urrency depreciation policies could not:"repair underlying economic proble= ms such as productivity or non-performing bank loans". NAM described O'Nei= ll's words as being "right on the money" which were deemed to shed light on= the 10% fall in the yen of the past 4 weeks. The remarks follow a letter t= o the Treasury last week citing numerous negative effects of the strong dol= lar, including loss of business share in global markets, increased layoffs = of employees, and relocation of plants overseas. Having said that, Secreta= ry O'Neill still reiterated the US strong dollar policy as a way to avoid a= ny uncontrollable decline in the US currency should his words to Japan may = be misunderstood to be intentionally weakening the dollar. Mr Kuroda of Jap= an's MoF wrote today in the FT that the declining yen reflected the nation'= s ailing economic situation and did not emanate from deliberate government = policies. =09[IMAGE] Audio Mkt. Analysis Dollar Hammers All Major Curr= encies Articles & Ideas NAM & the Strong Dollar: Phase II Philly = Fed-Supported Optimism Articles & Ideas Forex Glossary Economic Ind= icators Forex Guides Link Library [IMAGE] =09 =09=09[IMAGE][IMAGE] [IMAGE][IMAGE]=09 =09=09 This e-mail is never sent unsolicited. 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