Japanese Preview

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Interest Rates US: Japan: Eurozone: UK: Switzerland: 2.5% 0.15% 3.7=
5% 4.5% 1.75-2.75% [IMAGE] =09 [IMAGE] Japanese Forex Trading Prev=
iew October 21, 7:00 PM: EUR/$..0.8984 $/JPY..121.25 GBP/$..1.4328 $/CHF..=
1.6423 Japanese Forex Trading Preview by Darko Pavlovic At 7:50:00 PM Jap=
an August Tertiary Ind Prel (exp n/f, prev -0.9) Japan Sept all industry i=
ndex (exp n/f, prev -1.2) The single currency fell on Friday to a fresh 5=
week low vs. the dollar and a new 3-week low vs. the yen after German Sept=
ember IFO survey sank to a 8-year low of 85.0, as confidence in biggest Eur=
opean country weakened after September 11 and uncertainty abut the Eurozone=
growth. Bundesbank President Welteke commented that Germany would need a "=
lot of luck" to achieve the government's official growth forecast of 0.75% =
this year, but denied Germany would post negative growth and enter a recess=
ion. As economic growth in the Europe continues to slowdown everyone is loo=
king at the ECB to take a more proactive role in stimulating growth by cut=
ting interest rates. Despite the ECB's inclination to ostensibly prioritize=
price stability over growth, remarks by ECB president Duisenberg echoing t=
hose of the EU leaders that there is room to maneuver policy should inflati=
on fall sooner than expected would seem to suggest the ECB is flexible and =
may indeed slash rates by the end of the year, as many analysts anticipate.=
However, Duisenberg maintained his mantra that inflation will likely fall =
below 2% possibly early next year. A Reuters poll conducted yesterday showe=
d that 27 out of 50 economists believe the ECB will hold rates steady, 21 e=
xpect a rate cut and 2 are undecided. Support is seen at the 200-day moving=
average of 89.50, followed by 89.0 and 88.55. Resistance is seen at 90.15,=
90.35 and 90.65. The yen is almost unchanged from Friday's closing vs. th=
e dollar after advancing against the euro to a 3-week high of 108.88, due t=
o poor German IFO survey. Japanese Finance Minister Shiokawa proposed an ex=
tra budget of 3 trillion yen, out of which 1.68 trillion yen will be financ=
ed by government bonds. Finally, Koizumi declared that the structural refor=
ms must proceed whether GDP is plus or minus. Economic Minister Takenaka sa=
id that redenomination of yen could be one of the methods to revive the eco=
nomy. Takenaka is hoping to put the issue on the agenda for structural econ=
omic reform planned for fiscal 2002. Tokyo think tank predicted that Japan =
unemployment could rise to over 6% in the next fiscal year after jobless ra=
te hit record of 5% in July and August. USD/JPY support is seen at 120.65,=
120.20 and 120.0. Resistance is eyed at 121.50 and 121.80. Leaders of Asia=
Pacific Economic Cooperation finished their 2 day summit on Sunday condemn=
ing terrorism and promising to boost the global economy hit by prolonged sl=
owdown and September 11 attacks. Looking ahead to next week, the major in=
dicators from the US include the Index of Leading Indicators, the Employee =
Cost Index, durable goods, existing and new home sales, and the University =
of Michigan Confidence Survey. From the Eurozone, key data due for release =
are German CPI and PPI, Italian Industrial Orders, Italian CPI, ISAE Indust=
rial and Consumer Confidence Survey, French CPI, Italian Foreign trade, Eur=
oarea M3 data and foreign trade. Markets await the ECB rate announcement on=
Thursday October 25, even though the central bank is unlikely to ease mone=
tary policy next week. =09[IMAGE] Audio Mkt. Analysis Euro Crawls Up In =
Quiet Trading Articles & Ideas EURO: German IFO Will Remind ECB to B=
uild Growth Dollar Comeback Stopped by Risk of Terrorism Articles =
& Ideas Forex Glossary Economic Indicators Forex Guides Link Library =
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