Japanese Preview

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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 15, 7:00 PM: EUR/$..0.8839 $/JPY..131.22 GBP/$..1.4415 $/CH=
F..1.6638 Japanese Forex Trading Preview by Darko Pavlovic At 6:50 Japan =
Dec net foreign bond selling (exp n/f, prev 573.7 bln yen selling) The dol=
lar is trading around 131.20 yen after, rising from a 1-week lows of 130.90=
after Chinese Central Bank Governor Dai Xianlong said he hoped Japan would=
maintain a stable yen exchange rate. Asian officials raised their concern =
while PM Koizumi was on a visit with the yen's fall due to fears that it co=
uld spark a round of devaluations throughout Asia. In yesterday session, Se=
nior Ministry of Finance official Mizoguchi asserted that FX rates were in =
line with adjustments in the Japanese economy. Moreover, as Japanese invest=
ors prepare to repatriate assets before the end of the fiscal year book clo=
sings in March, the yen is likely to appreciate yet again and set off more =
jawboning to weaken the exchange rate. Separately, US Treasury's O'Neill ur=
ged Japan to become a greater contributor to global economic growth, adding=
that he would discuss the Japanese economic situation in Tokyo next week. =
The BoJ will end its second day policy meeting but many expect that possibl=
e adjustments to market operations would have little effect on currencies. =
Economic Minister Takenaka and BoJ Governor Hayami are due to speak at a ne=
ws conference on Wednesday. Japan Dec net foreign bond selling 827.1 bln ye=
n (vs. Nov 573.7 bln yen selling). Foreigners Dec net stocks selling 379.2 =
bln yen (vs.. Nov 405.6 bln buying) The index for shipments of investment g=
oods fell to a 14-year low in November, due to sluggish shipments of cranes=
and other types of loading equipment and general machinery. The data indic=
ate a constant decline in capital spending by Japanese manufacturers. Resis=
tance is eyed at 132.0, 132.20 and 132.70. Support holds at 130.80, 130.50 =
and 130.0. The euro fell to a 2-week low of 88.27 after the release of th=
e better-than-expected US retail sales data, which rose to 0.1% in December=
from the previous revised 3.0%. For most of the session, the pair has been=
hovering around the key 89.10 level, which marks the 50% Fibonacci retrace=
ment of the move from 82.25 to 95.96. The single currency also dived by mor=
e than a whole yen to a 2-week nadir of 115.71 against the Japanese currenc=
y. The euro was unable to capitalize on the third consecutive monthly rise =
in the German ZEW indicator by 3.9 to -83.9, as the ZEW expectations index =
advanced 10.1 to 35.9. Additionally, the ZEW Eurozone indicator eased by 4.=
7 to -72.8, while the expectations component improved 12.8 to 43.1. Support=
is viewed at 88.0, 87.50 and 87.0. Resistance is seen at 89.50, 90.0 and 9=
0.50. Tomorrow's release of US industrial production is forecasted to retu=
rn to positive territory for the first time in fourth months to somewhere b=
etween 0.0%-0.3% in December from the previous -0.3%. The improvement in in=
dustrial production is due to rises in hours worked and increases in auto p=
roduction, and bodes well for the manufacturing outlook. Capacity utilizati=
on is seen to edge up to 74.8% in December from the previous 74.7%. In addi=
tion, US CPI data is expected to hold steady at 0.0% in December helped by =
falling energy prices, as core CPI slips to 0.1% from the previous 0.4% ind=
icating that price pressures remain subdued. Traders will also examine the =
afternoon release of the Fed Beige Book for its clues about the Fed's econo=
mic and monetary policy outlook. This week's other major indicators from =
the US consist of jobless claims, housing starts and permit, the Philadelph=
ia Fed survey, international trade, and the University of Michigan confiden=
ce survey.Key Eurozone data include German GDP, French current account bala=
nce, Italian CPI, Dutch GDP and Italian industrial production. From the UK,=
traders await the labor market report for further direction on the pound. =
Highlights from Japan comprise balance of payments, Cabinet Office economy =
watchers survey, Tokyo department store sales and industrial production. =
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