JPY Daily News

Chinese Reserve Requirement Cut Overshadowed by Central Bank Liquidity Move

The JPY resumed its appreciation versus the USD yesterday after 6 central banks agreed to new swap lines. With the pair largely at the whim of larger global forces yesterday the USD/JPY fell as low as 77.34 before pulling higher. Support is seen at the November 18th low of 76.60.

What has become lost in yesterday's coordinated move was the 50 bp cut in the Chinese reserve requirement. This is the first step in the easing of Chinese monetary policy and a preparation by the Peoples Bank of China for an expected slowdown in both Chinese and global economic growth. The policy change is a 180 degree turn for China as less than 3-months ago the Chinese were concerned with ways to tackle rising inflation and a property market that is said to be a housing bubble on par with US housing market in 2007.

Current Time: 05/27 00:52 GMT

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#	Time	$€£¥	Event	Per.	Prev.	Fore.	Act.	Imp.
12/01
	23:50	JPY	Capital Spending	y/y	-7.8%	-3.4%	-9.8%
	23:50	JPY	Monetary Base	y/y	17.0%	17.7%	19.5%