JPY: Phrasing on Currency Steps Up, But Intervention Language Unchanged
Jun-10 07:37
Recall that Kanda quoted in these headlines is the official appointed as the 'FX Tsar' last year and would be responsible for any FX intervention if it was to take place.
Just jawboning for now "will take appropriate action if needed" etc - but looks like a modest step-up in language/urgency. The phrasing on intervention looks broadly inline with the communication on currency back in late April. In April, the language used was:
- Recent FX moves warrant extreme concern
- Will respond appropriately on FX if needed
Want to read more?
Find more articles and bullets on these widgets:
Historical bullets
GILT AUCTION PREVIEW: 0.50% Jan-29
May-11 07:20
- The DMO will return to the market this morning to sell GBP2.5bln of the 7-year 0.50% Jan-29 gilt.
- This will be the fifth auction of the gilt, and the first since it transitioned into the short bucket.
- The auction size of GBP2.5bln has been consistent across all auctions with the bid-to-cover ranging from 2.21-2.40x and tails ranging from 0.3-0.5bp.
- We would expect to see a similar result today, albeit with a potentially wider tail. However, we would still expect the tail to be narrower than the 1.6bp seen on yesterday's 0.875% Jul-33 green gilt auction.
- Timing: Results will be available shortly after the auction closes at 10:00BST with a further GBP625mln available to successful bidders through the PAOF.
TURKEY: Analyst Warns of Intra-Alliance Volatility in Opposition Group of Six
May-11 07:17
LOCAL NEWS
- Local Analyst warns that intra-alliance volatility is inevitable in the opposition alliance as members jostle for top position in the 2023 presidential race.
- Over the Eid Al-Fitr holiday, Istanbul Mayor Imamoglu conducted visits to the Black Sea region that held tha hallmarks of a campaign visit although he has not been formally selected as the candidate over CHP chair Kilicdarogu, despite his higher polling scores. https://www.dailysabah.com/opinion/columns/confusi...
- Dunya news warns that dollarisation is on the rise once again after USD/TRY broke throygh 15.00. Says both the public and companies have grown in need of foreign currency, mainly due to energy prices. Rising costs are causing the deteriorating current account balance, as well as exponential raw material prices for companies, to increase demand for foreign currency.
- Experts say Govt’s management of FX transactions also results in the demand of both citizens and companies to be brought forward with restrictions derailing expectations and boosting demand. They fear tighter steps could be taken in the near future. – Dunya
- Turkish Government plans 1-3 year imprisonment for hoarding goods to push prices higher according to the latest decree via the justice minister. This follows a rise in CPI to 70% in April, but independent inflation research group ENAG says the real number is closer to 156.86% - Ahval
PORTUGAL AUCTION PREVIEW: 0.475% Oct-30 OT
May-11 07:14
- On offer today: E500-750mln of the 0.475% Oct-30 OT (ISIN: PTOTELOE0028) - a former 10-year benchmark.
- Market colour: 0.475% Oct-30 OT yields have risen approx. 170bp since launch, reaching a high of 2.064% on Monday, and softening approx. 19bp to 1.876% at time of writing.
- Spreads to the 0% Aug-30 Bund have widened around 45bp since the beginning of the year. The second half of March saw spreads narrow just over 10bp, however momentum was regained in April, since reaching a high of over 100bp on Monday. Spreads had since ticked down a little to trade around 97.6bp at time of writing.
- Timing: Results will be available shortly after the auction closes at 1030 BST / 1130 CEST.
Auction history: Most recent auctions
| Date | Issued | Avg yield | Bid/cover | Price | Pre-auct | Operation |
| Current | 1.876% | |||||
| Last 5 ave | E706mln | 0.207% | 2.36x | |||
| 14-Jul-21 | E622mln | 0.127% | 2.29x | 103.20 | 102.97 | Auction |
| 10-Mar-21 | E625mln | 0.237% | 2.32x | 102.26 | 102.02 | Auction |
| 13-Jan-21 | E500mln | -0.012% | 3.02x | 104.75 | 104.48 | Auction |
| 09-Sep-20 | E964mln | 0.329% | 2.19x | 101.45 | Auction |
