A look at the day ahead in Asian markets from Jamie McGeever.
Many analysts see him as a pragmatic policymaker who will prefer tip-toeing toward any exit from the BOJ's ultra-loose monetary policy rather than make sudden changes to a stimulus program he helped create.
And the yen is on the slide. It fell 1% on Monday and is down 3% since Friday, its biggest two-day fall in three years.Generally speaking, Asian markets are feeling the heat from the sudden U.S. interest rate outlook shift following January's freakishly strong U.S. jobs report released on Friday. The Fed's implied 'terminal' rate in June is now well above 5.00%, the implied year-end rate is higher than current the fed funds range, markets are now pricing in only 20 basis points of easing this year and the two-year yield has spiked around 40 basis points.
This may be the tightening of financial conditions Fed Chair Powell and his colleagues are seeking. Or they may be irrational and unjustified market swings in response to one data point that will prompt a response from Powell when he speaks at the Economic Club of Washington on Tuesday. The MSCI Asia ex-Japan index slumped 2.4% on Monday, its worst day since June last year, Chinese stocks had their worst day this year and Hong Kong tech stocks fell 3.6%.- Fed Chair Powell speaks Jamie McGeeverJamie McGeever has been a financial journalist since 1998, reporting from Brazil, Spain, New York, London, and now back in the U.S. again. Focus on economics, central banks, policymakers, and global markets - especially FX and fixed income.
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