Commentary Out of Japan
- Former Ministry of Finance official Sakakibara (“Mr Yen”) writes Japan should not intervene in the stock market to defend certain levels. Says recent market speculation has it that public fund buying has been supporting the Japanese share market,
- Japan’s Finance Minister Yosano says it’s too early to say Japan in deflation.
Japanese Economic Releases
Japans CPI figure came in as expected with the USD/JPY moving toward the session lows with S&P Futures doing the same.
National CPI (YoY) – Survey:-0.1% Actual:-0.1% Prior: 0%
National CPI ex-food/energy – Survey: -0.2% Actual:-0.1% Prior:-0.2%
Large Retailers’ Sales – Survey:–6.5% Actual:-8.2% Prior: -5.6%
Retail Trade (YoY) – Survey:-3.0% Actual:-5.5% Prior: -2.4%
Retail Trade (MoM) -Survey:-0.6% Actual:-0.3% Prior:0.6%
New Zealand GDP & Trade Balance
The New Zealand GDP and Trade Balance came in better than expected and as a result the Kiwi received a bid, but has yet to approach yesterday’s highs.
GDP (QoQ) – Survey: -1.1% Actual:-0.9% Prior:-0.4%
GDP (YoY) – Survey:-2.0% Actual:-1.9% Prior:-0.1%
Trade Balance – Survey:75M Actual:489M Prior:-187M
Imports – Survey:3.3B Actual:2.97B Prior:3.36B
Exports – Survey:3.35B Actual:3.46B Prior:3.18B
Balance YTD – Survey:-5500 Actual:-5161 Prior:-5480
Feds Lacker Q&A at Press Conference
- STRESS TEST MAY NEED SOME FORM OF MODIFICATION
- IMPORTANT TO STEP UP LEVEL OF STIMULUS
- FED DEBT ISSUE CREATES RISK FOR US
- TALF ‘STRUCK ME AS CREDIT ALLOCATION
- ARGUED STRONGLY AGAINST FED ALLOCATING CREDIT
- IMPORTANT TO DECIDE ON SIZE OF FINANCIAL SAFETY NET
Feds Lacker on the newswire
- REASONABLE TO EXPECT ECONOMY TO BOTTOM THIS YEAR
- AUTO REPLACEMENT TO PUT A FLOOR ON SALES DROP
- FED POLICY APPROPRIATE THOUGH EXTRAORDINARY
- BULK OF BAD HOUSING NEWS NOW PAST
- WAITING TOO LONG MAY CAUSE SIZEABLE INFLATION
- POPULATION GROWTH TO GRADUALLY CUT HOUSING SUPPLY
- NEED TO AVOID WAITING TOO LONG TO REVERSE POLICY
US Initial Claims come in at 652K as per expectations
The US Initial Claims came in at 652K. This is as expected. The previous month was revised slightly lower to 644K. The 4 week moving average fell to 649K from a revised 650K
The Continuing Claims came in higher at 5560K. This was higher than expectations. The 4 week moving average moved up to 5343.8K . This is up 440K jobs versus a month ago, indicating that unemployment is still rising.
The employment picture remains weak, but it is a lagging indicator and will take some time to reverse.
US GDP came out at -6.3% for the 1st quarter. Consumption fell by 4.3% (vs -4.4% expectation).
UK’s Chancellor Darling on the Wires
UK Chancellor Darling: Fixing banks is a prerequisite for recovery, Goverment must continue to support economy
- UK in ‘severe’ economic downturn; have already made ‘substantial stimulus’
- Says Germany also is experiencing serious downturn
- Cap or regulation of interest rate would not work
- Quantitative easing is essential in securing employment around the world
- Says Japan (in the 1990s) made the mistake of not dealing with bad assets
Bank of England’s Sentance on the Wires
BoE’s Sentance: CPI data shows short term impact of GBP decline
- Sees tentative signs UK housing market has “bottomed out”
- Reminder: Back on March 24, UK CPI figures came in higher than expectations (M/M: 0.9% V 0.3%E; Y/Y: 3.2% V 2.6%E)
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