This is arguably the final piece of the puzzle in concluding the pivot towards monetary policy normalisation for the BOJ. However, it is one that is going to take almost forever to complete. In fact, none of us will be around to even witness the completion. And that is if things go according to plan - in which we know in markets that they don't often do.The guideline for selling of its ETF and REIT holdings will take effect on 19 January. And that means they could begin sales in the coming days or perhaps very soon after.That being said, their ETF holdings have an extremely large book size of ¥37 trillion ($242 billion). So in order to avoid any major disruption to the market and cause panic-selling in Japanese stocks, the central bank is planning to offload them in a slow manner. And when I mean slow, it is very, very, very slow.The annual pace of selling in ETFs is going to be roughly ¥330 billion ($2.1 billion). And if you compare that to their book size, it means that this is an operation that would take over 100 years to be completed if said pace is to be maintained throughout. ¯\_(ツ)_/¯As for REITs, they will be shedding that at an annual pace of ¥5 billion ($31 million). So, the amount there is nothing as nearly as impactful as the focus on ETFs. This article was written by Justin Low at investinglive.com.

EUROPEAN SESSIONIn the European session, we don't have much on the agenda other than the final Italian inflation data which is not going to change anything for the market or the ECB. We got reports late yesterday from Fox News saying that US air, land and sea military assets were moving to the Middle East. It looked like US-Iran tensions were easing following Trump's comment on Wednesday that killings in Iran were stopping and reports that he refrained from using military force at the last minute.Now, it doesn't look like things are over yet, so the market might get back into pricing some geopolitical risk premium and maybe hedge into the weekend risk. The Fox News report added that the US military transit to the Middle East is expected to take a week, but you never know what could happen over the weekend with Trump.AMERICAN SESSIONIn the American session, we get Canadian Housing Starts, US Industrial Production and Capacity Utilization and the US NAHB Housing Market Index. All these indicators are rarely market-moving unless there a big deviations. We will also have some Fedspeak with Fed's Bowman and Fed's Jefferson being the main highlights, but it's unlikely they will add anything new at this point.CENTRAL BANK SPEAKERS15:50 GMT/10:50 ET - Fed's Collins (hawkish - non voter)16:00 GMT/11:00 ET - Fed's Bowman (dove - voter)20:30 GMT/15:30 ET - Fed's Jefferson (dovish - voter) This article was written by Giuseppe Dellamotta at investinglive.com.

Prior +2.3%HICP +2.0% vs +2.0% y/y prelimPrior +2.6%In terms of headline annual inflation, the December reading is the lowest for the year and the softest reading since September 2024. However, consumer prices in Germany rose by an average of 2.2% in 2025. And that matches up to the 2024 average reading, which was also 2.2%. Destatis notes though that at least this signals that "consumer price trends have stabilised since the previous years it was significantly above 2%".As for core annual inflation, that is seen at 2.8% for the whole of 2025. It's some good news for Germany as the trend continues to move lower but the pace of decline still leaves a lot to be desired. For some context, this was 5.1% in 2023 and 3.0% in 2024. So, the marginal decline in 2025 is nothing all too positive as core prices look to be more stubborn.That especially since it continues to hold well above the key 2% threshold, one that the ECB continues to look out for in Europe's largest economy.Looking at the breakdown, services inflation remains sticky at 3.5% for the year. This compares to the 4.4% estimate in 2023 and 3.8% estimate in 2024. Once again, this is well above the desired 2% mark. Of note, combined passenger transport (+11.4%), social services (+8.7%), and insurance (+7.4%) became noticeably more expensive for consumers on average.Meanwhile, prices for many other services, such as inpatient healthcare (+6.7%), vehicle maintenance and repair (+5.5%), package holidays (+4.6%), and restaurant services (+4.0%), also increased significantly from 2024 to 2025.So, this is one spot that is going to be heavily scrutinised in 2026 as well.Besides that, prices for goods increased by 1.0% in 2025, including food prices by 0.8%. So, at least this is one spot that's doing "better" on the inflation front. This article was written by Justin Low at investinglive.com.

There are just a couple to take note of on the day, as highlighted in bold below.The first one being for EUR/USD at the 1.1600 mark. It's not the largest of expiries on the board for today but it is a decent-sized one at least. That could help to keep price action a bit stickier close to the figure level in the session ahead. However, an extension to the daily range could see price look for a downside test of its 200-day moving average at 1.1582. So, just be mindful of that.A break under the key technical level above could pave the way for a shove towards a test of 1.1500 next. That as sellers remain in near-term control of the currency pair.Then, there is one for USD/JPY at the 158.00 level. The pair is already seeing a shift in the near-term bias here but the expiries could play a role in limiting downside action, at least for European morning trade.But again, headline risks remain paramount at this stage. Any further jawboning or verbal intervention by Tokyo officials could easily cause swings in price movements and that is the bigger and more influential driver of price action at this stage.Looking to next week though, there is very little to glance at on the expiries board. It's a good reminder that it will be a long weekend in the US in observance of Martin Luther King Jr. Day. As such, US markets will be closed and that's leading to the lack of interest in terms of trading expiries on the day itself.That said, there is a very large one for EUR/USD at the 1.1500 worth keeping an eye out for amid the levels highlighted above.For more information on how to use this data, you may refer to this post here.Head on over to investingLive (formerly ForexLive) to get in on the know! This article was written by Justin Low at investinglive.com.

NASDAQ Technical Analysis Today (16 January 2026): Why Yesterday’s Late Selloff Did Not Break the Bullish StructureI'll start out with a medium term view of the market, the way I see it, via this Nasdaq technical analysis video from today. During our analysis, we always look at Nasdaq futures (NQ, not NDX).Traders looking at the NASDAQ late on Thursday, 15 January, may have walked away with a cautious impression. After a strong intraday rebound, price gave back a meaningful portion of gains into the close, finishing below the daily high-volume node and below the midpoint of the session’s range.For some, that raised a familiar concern: Was this the start of a bull trap? For others, especially those hearing increasingly bullish narratives about a push toward new all-time highs, the late selloff felt like a warning sign that momentum had already failed.That surface-level reading, however, misses what was happening inside the auction.From the above video, and the above context and question in mind, we shall proceed to the deeper order flow analysis for Nasdaq so far today...What Order Flow Shows Beneath Yesterday’s CloseOrderFlow Intel analysis revealed that yesterday’s selling was not accepted as a new bearish regime. Instead, it appeared as late-session profit taking and inventory adjustment, occurring after a successful recovery from the earlier washout near 25,560.Key observations from order flow:Buyers successfully defended the 25,600–25,640 repaired value zone.Selling pressure into the close did not lead to acceptance below that area.The medium-term recovery structure remained intact, even as momentum cooled.This distinction matters. A market that rejects higher prices behaves very differently from one that simply pauses after a strong move.Live Context for Friday, 16 January 2026: What Matters Right NowAs of today’s session, the NASDAQ futures are behaving in a way that supports that interpretation.Today’s developing daily low is holding above ~25,700, which aligns with prior resistance from early January and sits above yesterday’s repaired value.The developing daily high-volume node is near ~25,742, suggesting value is rebuilding higher, not collapsing.On the intraday charts, price has re-entered yesterday’s value area, reclaimed yesterday’s value area low near 25,785, and is rotating toward yesterday’s point of control around 25,880, which remains a key decision level.This is not breakout behavior yet, but it is constructive stabilization, not bearish rejection.Why This Is a Decision Zone, Not a Breakdown for NasdaqMarkets rarely move in straight lines, especially after sharp recoveries. What we are seeing today is a negotiation phase:Below 25,600, the bullish recovery thesis would weaken.Holding above 25,700–25,785 keeps the recovery intact.Repeated acceptance above 25,880 would strengthen the case for a broader continuation attempt.Failure near 25,950–26,000 without acceptance would imply more consolidation rather than immediate upside.OrderFlow Intel helps frame these scenarios by focusing on acceptance versus rejection, rather than reacting emotionally to a single candle close.Why This Page Is a Live NASDAQ Analysis for TodayThis NASDAQ technical analysis for 16 January 2026 is intentionally live and evolving.Rather than publishing a static opinion, this page will be updated as:New order flow information developsKey levels are tested or defendedAcceptance or rejection becomes clearerFor traders and investors who follow the NASDAQ directly, or use it as a proxy for broader equity market risk, returning to this page later today may provide additional orderFlow Intel updates at the bottom of the article. Look at the bottom of this page as today evolves.The Takeaway for Traders and Investors TodayYesterday’s late selloff did not end the bullish premise. It transitioned the market from impulse to evaluation.Order flow continues to suggest that:The downside washout has been repaired.Buyers are still active at higher levels.The market is deciding whether it can accept higher value, not abandoning it.That is a very different message than what the closing candle alone might imply.This is exactly the kind of environment where context and structure matter more than headlines, and where orderFlow Intel provides meaningful decision support beyond traditional technical analysis.Trader Update – European Session Follow-Up11:03 – Friday, 16 January 2026 (CET) Time in Brussels, BelgiumFollowing the European market open, the NASDAQ continues to behave constructively, and the broader bullish recovery thesis remains intact.Despite some hesitation and rotation, buyers are still holding key ground, and there are no signs so far that sellers are regaining structural control. Importantly, the market is not responding to yesterday’s late selloff with renewed downside pressure.Are bulls still in control?On the higher timeframes, the answer is yes, cautiously.On the daily view, value remains in the upper portion of the developing range, with the high-volume node still positioned near the top of the day. This suggests the market is accepting higher prices gradually, rather than rejecting them.On the medium-term structure, price is holding above the repaired value zone around 25,700–25,640, which remains the key area bulls need to defend. As long as this zone holds, the recovery structure stays valid.On the intraday charts, price has retraced toward fair value (VWAP) and found buyers before meaningful acceptance below it, which is a constructive sign during a grinding, low-volatility phase.In short, bulls are not accelerating, but they are not losing ground either.Are bears getting stronger?So far, there is no evidence of increasing bearish control.Selling attempts remain rotational, not initiative.Downside probes have failed to gain acceptance below key value areas.Order flow shows absorption rather than liquidation, meaning sellers are testing, but not pressing with conviction.This keeps the downside risk contained, even if upside progress remains slow.Updated orderFlow Intel scores (–10 to +10 scale)Higher timeframe (daily): +4 The washout has been repaired, and structure remains constructive, though not yet in breakout mode.Medium timeframe: +5 The recovery is intact, but the market is in a negotiation and digestion phase, not a momentum phase.Short-term timeframe: +1 Slightly constructive, but highly tactical. This score can change quickly and is less relevant for positioning decisions.What this means for traders and investorsThis is a market that is working through higher value, not rejecting it. That process often looks frustrating on lower timeframes, but it is typical after sharp recoveries.The key takeaway is simple:The bullish premise is not done.The market is stabilizing, not failing.Directional clarity will come from acceptance or rejection at higher value levels, not from short-term noise.We will continue updating this page as the session develops and as orderFlow Intel provides additional insight into whether the market is ready to accept higher prices or needs more time to consolidate. This article was written by Itai Levitan at investinglive.com.

The Japanese yen remains the most volatile among the major currencies today with USD/JPY holding a larger range after the downdraft earlier in Asia trading. The pair hit a low of 157.97 after some added verbal intervention by Japan finance minister Katayama here. That before rebounding to 158.30 levels now, still well below the earlier highs around 158.60-70.Now, verbal intervention by Tokyo officials isn't anything new when it comes to their attempts to arrest the currency decline. However, this time around the language that is used is a bit more different.Katayama already stood out with an oddly specific comment about price movement earlier this week here. And today's remarks even went as far as saying that their readiness to intervene in the market is "included in an option in the US-Japan agreement". In other words, he's delivering a warning to the market that Tokyo has got the green light from Washington to step in if need be.Still, the Takaichi trade remains a key driver in continuing to weigh down the yen currency since October. And that momentum remains very much intact in the big picture. But at least for today, the near-term sentiment has shifted a little:After numerous attempts to try and break under the 100-hour moving average (red line) this week, USD/JPY sellers finally made the breakthrough today. And that sees the near-term bias switch to being more neutral now with price action keeping in between that and the 200-hour moving average (blue line).That leaves some room to roam as traders look to figure out how a snap election will factor into the Takaichi trade and if any further selling in the yen could trigger Tokyo to intervene in the market. On the former, Credit Agricole notes that opposition lawmakers trying to fight against Takaichi's premiership will at least reduce the one-sidedness of the trade against the yen.The firm argues for that there is an element of buy the rumour, sell the fact in considering the impact of Japan's political scene towards the yen currency.As things stand, they see investors continuing to buy up yen pairs in anticipation of looser fiscal and monetary policy under a strengthened Takaichi mandate.But with positioning flows already clearly leaning towards further yen weakness, the risk is that the market starts to fade the election story once it is officially called next week as opposition lawmakers gather to try and take on Takaichi and reduce her political influence. In turn, Credit Agricole sees that as a risk in creating headwinds for further USD/JPY upside driven by solely by politics. This article was written by Justin Low at investinglive.com.

Mind you, this has been an ongoing issue since late 2023 already. And when the ONS could not figure out how to improve the data reliability, they opted to try and revamp the whole Labour Force Survey (LFS). In 2024, they announced that they would be transitioning to a Transformed Labour Force Survey (TLFS). That "in order to improve the quality of the labour market data based on a more adaptive and responsive survey".But during this time until now, the labour market data remains suspect at best and the Bank of England itself has come out to criticise the statistics office on more than one occasion already.The latest report by Bloomberg now states that the ONS is planning to prepare for contingency plans to delay the launch of its new jobs survey by up to six months.The initially scheduled plan was to make the transition and roll out the new labour market survey in November. However, another scenario is now under consideration where the survey is launched in May 2027 instead. Geez. Quite unreal now, innit?As things stand, the ONS labour market report is still the best gauge one can use to get a handle on things but it isn't quite of the same quality and assurance as it was before all these shenanigans.But honestly, data quality issues for a report so important like the labour market survey is quite something. I mean, this is a key economic indicator for policymakers and for markets. So, the ONS really has to just step up and be better here.The past year alone has also seen the UK statistics office had a few gaffes:UK stats office to pause publication of producer price indexUK stats office deals with another blunder, this time in public finances data This article was written by Justin Low at investinglive.com.

Canada & China are moving to rebuild ties, eye closer cooperation in agriculture & energyMUFG sees modest rise in India bond yields as RBI holds rates, near end of easing cycleYen rose as intervention warnings meet talk of earlier BOJ rate hikes (April hike risk)Japan fin min “Won’t exclude any options” , possibility of US/Japan joint yen interventionChina curbs high-speed trading by stripping exchange server access, algo trading hitTrump to force tech firms to fund new power plants via emergency power auctionPBOC sets USD/ CNY reference rate for today at 7.0078 (vs. estimate at 6.9722)Fed’s Daly says policy well positioned, can afford patience, urges deliberate calibrationWest Virginia treasury proposes bitcoin & precious metals purchases ... late cycle signal?ECB sees no near-term rate debate, Lane says current rates form baseline for yearsChina only months behind US AI models, DeepMind CEO tells CNBC. China has nearly caught upWhite House warns AI chip tariffs are just ‘phase one’ of broader semiconductor actionRetail investors drive silver into most crowded commodity trade - pile into ETFsUS aircraft carrier heads to Middle East as Iran warns against aggression ... stay tuned!New Zealand December 2025 Food Price Index -0.3% m/m (prior -0.4%)New Zealand December 2025 Manufacturing PMI (prior 51.4)investingLive Americas market news wrap: Jobless claims fall to the lowest since early NovExecutive summaryJPY outperformed, driven by renewed FX intervention warnings and Reuters reporting that some BOJ policymakers see scope for an earlier rate hike, with April in playNZD edged higher after a strong manufacturing PMI and further moderation in food prices supported the near-term growth and inflation outlookUS trade policy risk resurfaced, with the White House flagging that AI chip tariffs were only a “phase one” actionECB signalled rate stability, but warned Fed policy risks could spill into global marketsGeopolitics cooled modestly, with Iran signalling restraint; oil ticked higher but safe-haven demand eased, weighing on goldChina moved to curb high-frequency trading, cutting latency advantages by forcing servers out of exchange data centresThe yen was the standout mover, surging after Japan’s finance minister said foreign-exchange intervention remains an option under the U.S.–Japan framework and that no measures, including joint action, are being ruled out. The warning against excessive or disorderly moves delivered an immediate market impact. The move gathered further momentum after a Reuters report said some Bank of Japan policymakers see scope to raise interest rates sooner than markets expect, with April emerging as a live possibility if weak-yen-driven inflation risks continue to broaden. The report underscored growing internal concern that yen depreciation could encourage wider price pass-through, complicating the BOJ’s assumption that cost-push pressures will fade smoothly. Yen crosses fell, with USD/JPY briefly slipping below 158.00 before finding its feet.That said, the yen’s underperformance earlier this month has been exacerbated by political dynamics, with expectations that an election victory for Prime Minister Sanae Takaichi would give her a strong mandate for expansionary fiscal policy, a factor that has kept structural pressure on the currency despite rising intervention rhetoric. A sustained recovery for the yen is difficult to grasp in this environment. -Earlier in the session:In New Zealand, data flow remained supportive. The manufacturing PMI jumped to 56.1 in December, the strongest reading since 2021, with all sub-indices expanding and new orders leading the gain. BNZ flagged upside risk to Q4 GDP and solid momentum into early 2026. That was followed by a softer Food Price Index, which fell 0.3% m/m in December after a -0.4% print in November. While food prices remain up 4% y/y, the sequential declines are an encouraging signal for the Reserve Bank of New Zealand, helping the kiwi track modestly higher on the session.In the United States, trade policy uncertainty returned to the fore. After imposing a 25% tariff on a narrow set of advanced AI chips earlier this week, a White House official said the measures should be viewed as a “phase one” action, with further announcements possible depending on negotiations with foreign governments and companies.In Europe, ECB Chief Economist Philip Lane reiterated that there is no near-term rate debate if the baseline outlook holds, but warned that U.S.-origin shocks — including any departure by the Federal Reserve from its mandate — could destabilise global financial conditions and force a reassessment in Europe.On the geopolitical front, reports that a U.S. aircraft carrier is moving to the Middle East were largely viewed as stale, having circulated earlier in the week. Iran’s deputy UN envoy said Tehran seeks neither escalation nor confrontation, though warned any aggression would draw a strong and lawful response. Oil opened a few cents higher, while gold slipped as easing geopolitical tension reduced safe-haven demand.Finally, China moved to rein in high-frequency trading, forcing servers out of exchange data centres in Shanghai and Guangzhou — a step that will reduce latency advantages for both domestic and global trading firms. Asia-Pac stocks:Japan (Nikkei 225) -0.05%Hong Kong (Hang Seng) -0.27% Shanghai Composite -0.22%Australia (S&P/ASX 200) +0.42%---Have a great weekend, see you all on Monday for impactful China data on the agenda! This article was written by Eamonn Sheridan at investinglive.com.

Summary:Canada and China are seeking to reset ties through a new strategic partnershipPM Mark Carney says cooperation could deliver “historic” economic gainsFocus areas include agriculture, energy, agri-food and financeCanada is diversifying trade amid tensions with the United StatesChina is also looking to counter U.S. tariff pressure through new partnershipsCanada and China are seeking to reset and deepen their bilateral relationship, with Canadian Prime Minister Mark Carney describing the potential gains from renewed cooperation as “historic” during talks with Chinese President Xi Jinping.Carney’s visit marks the first trip to China by a Canadian prime minister since 2017 and represents a significant diplomatic step after years of strained relations. Speaking to Xi, Carney said the two countries were laying the groundwork for a new strategic partnership at a time of global division, arguing that closer cooperation could deliver immediate and lasting benefits by building on each country’s strengths.He highlighted sectors such as agriculture, agri-food, energy and finance as areas where collaboration could generate meaningful economic gains. Carney said these fields offered scope for rapid progress and sustained engagement, signalling a pragmatic approach focused on trade and investment rather than broader geopolitical disputes.The outreach comes as Canada looks to diversify its trade relationships amid growing uncertainty in its ties with the United States. Washington remains Canada’s largest trading partner, but relations have been tested after U.S. President Donald Trump imposed tariffs on some Canadian goods and made comments questioning the long-standing alliance between the two countries. Amd threatened to invade and annex the country. Those moves have sharpened Ottawa’s interest in strengthening links with other major economies, including China, Canada’s second-largest trading partner.For Beijing, the timing is also significant. China has faced renewed trade pressure from the United States since Trump’s return to the White House, with tariffs again weighing on exports and investor sentiment. Closer engagement with a Group of Seven economy such as Canada offers China an opportunity to deepen ties within a traditional sphere of U.S. influence and underscore its commitment to multilateral economic cooperation.While Carney’s remarks emphasised economic opportunity, the path forward is unlikely to be frictionless. Past tensions over trade, technology and diplomatic disputes remain in the background. Still, both sides appear keen to stabilise relations and pursue areas of mutual benefit, particularly as global trade becomes increasingly fragmented.The talks signal a tentative but notable shift in Canada–China relations, suggesting both governments see strategic value in closer cooperation as they navigate a more contested global economic landscape. This article was written by Eamonn Sheridan at investinglive.com.

Summary:MUFG sees India’s 10-year yield edging higher through 2026Bank forecasts 6.60% by March and 6.75% by year-endRBI seen at end of rate-cut cycle, repo rate held at 5.25%Liquidity injections via bonds and FX swaps to continueUSD/INR likely driven more by global factors than local yieldsIndia’s benchmark government bond yields are likely to drift modestly higher over the course of 2026, as the Reserve Bank of India (RBI) approaches the end of its rate-cutting cycle while continuing to manage liquidity aggressively, according to MUFG.In a research note, MUFG said it expects India’s 10-year benchmark bond yield to rise gradually to around 6.60% by March and toward 6.75% by the end of the year, from current levels near 6.65%. The bank characterised the outlook as one of upward bias rather than sharp tightening, reflecting a policy environment that is shifting from easing toward an extended hold.MUFG said it believes the RBI has effectively reached the end of its rate-cutting cycle and expects the central bank to keep the repo rate unchanged at 5.25% for a prolonged period. With inflation risks appearing broadly contained and growth holding up, policymakers are seen as favouring stability over further stimulus or premature tightening.While policy rates may be on hold, liquidity management is expected to remain highly active. MUFG expects the RBI to continue injecting liquidity through bond purchases and foreign-exchange swaps through 2026, reinforcing its role in smoothing funding conditions even as rates remain steady. The scale of past intervention underscores that commitment: in 2025, the RBI injected a record 11.73 trillion rupees into the banking system via bond buying, FX swaps and a reduction in the cash reserve ratio.The bond-market outlook also has implications for the currency. The Indian rupee (attached USD/INR chart) highlights a steady (INR) downward grind, with the pair recently trading around the 90.30 area USD/INR bounced from intervention lows. . A mild rise in domestic yields could offer some support to the rupee at the margin, particularly if U.S. rate expectations stabilise. However, MUFG’s view that liquidity will stay abundant suggests that yield support for the currency may be limited.Instead, USD/INR is likely to remain driven by broader dollar dynamics, capital flows and RBI FX operations rather than domestic rate moves alone. Continued RBI liquidity injections and FX swaps also point to an ongoing effort to dampen currency volatility rather than defend any specific level.Overall, MUFG’s outlook suggests a year of relative stability for Indian bonds, with modest yield drift higher, an RBI firmly on hold, and a rupee that remains range-bound but sensitive to global forces rather than domestic tightening pressure. This article was written by Eamonn Sheridan at investinglive.com.

Summary:The yen rose after Finance Minister Katayama reiterated intervention remains an optionReuters reports some BOJ policymakers see scope for earlier hikes, with April in playBOJ expected to hold at 0.75% in January, but debate on timing is activeWeak yen is seen inside BOJ as adding to broadening inflation pressureBOJ may lift FY2026 growth and inflation forecasts in next week’s reviewThe yen strengthened after Japan’s Finance Minister Katayama reiterated that foreign-exchange intervention remains on the table, and gains were reinforced by a Reuters report suggesting some policymakers inside the Bank of Japan (BOJ) see scope to raise interest rates sooner than markets currently expect.Katayama’s remarks, delivered earlier, signalled Tokyo’s readiness to act against excessive currency moves, including the possibility of joint action with the United States. That rhetoric helped lift the yen by increasing the perceived risk of official pushback against further depreciation.The move was compounded by an “exclusive” Reuters report citing four sources familiar with BOJ thinking, which said some policymakers view April as a realistic window for another rate hike if evidence continues to build that Japan can achieve its 2% inflation target on a durable basis. While the BOJ is widely expected to keep its policy rate steady at 0.75% at its January meeting, the sources said many policymakers see scope for further tightening, and some would not rule out action as early as April.That timeline would be earlier than prevailing market and private-sector expectations, which Reuters noted are centred on a move around mid-year. In a Reuters poll, most economists expected the next hike in July, with a strong majority seeing the policy rate reaching 1% or higher by September.A key driver of the internal debate is the yen itself. The Reuters report said the risk that a weak yen could add to already broadening inflationary pressure is drawing increasing attention within the BOJ. Yen depreciation raises the cost of imported fuel, food and raw materials, and could encourage companies to pass through higher costs into a wider range of consumer prices, potentially complicating the BOJ’s assumption that cost-push inflation will moderate smoothly.Reuters also reported that the BOJ is likely to raise its fiscal 2026 growth and inflation forecasts in its quarterly review due next week. Current forecasts from October projected 0.7% growth and 1.8% core inflation for fiscal 2026, but sources suggested those numbers may be revised higher.The April BOJ meeting is emerging as a focal point because it follows the annual wage negotiation season and coincides with a new round of forecasts, giving policymakers fresh information on wage momentum, demand resilience and inflation persistence. A shift toward earlier tightening would mark a more hawkish reaction function, particularly if yen weakness is increasingly viewed as a catalyst for action.For markets, the combination of intervention rhetoric and a potentially more hawkish BOJ narrative provides near-term support for the yen, even if the longer-run direction remains sensitive to U.S.–Japan rate differentials and global risk sentiment. This article was written by Eamonn Sheridan at investinglive.com.

Japan’s Finance Minister Katayama delivered a clear warning to currency markets, reiterating Tokyo’s readiness to act against excessive yen moves:“Intervention included as an option in U.S.-Japan agreement.”“I have said ready to take decisive action without ruling out any options.”“Won’t exclude any options” when asked about the possibility of U.S.–Japan joint intervention.The remarks underline Japan’s growing unease with recent yen volatility and signal that authorities are keeping the full range of countermeasures firmly on the table.With this, Japan has stepped up its verbal defence of the yen. Finance Minister Katayama explicitly confirming that foreign-exchange intervention remains an option under existing understandings with the United States. The comments come as renewed weakness in the yen revives concerns over imported inflation, market disorder and policy credibility.Katayama’s remarks reinforce Tokyo’s long-standing stance that sharp, speculative-driven currency moves are undesirable. By stressing that intervention is “included as an option” in the U.S.–Japan framework, the finance minister sought to remind markets that Japan is not acting in isolation and retains diplomatic cover should it decide to step in.Of particular note was Katayama’s refusal to rule out any options, including the prospect of coordinated U.S.–Japan intervention. While such joint action is rare and typically reserved for periods of extreme market stress, the reference alone is designed to raise the perceived cost of betting aggressively against the yen. Discussing possible joint intervention always carries more weight with JPY traders, increasing their wariness of holding short yen positions.The renewed warning follows a period of sustained yen weakness, driven by wide interest-rate differentials between Japan and the United States and expectations of further fiscal spending in Japan. Even as the Bank of Japan has begun to normalise policy after years of ultra-loose settings, Japanese yields remain far below U.S. levels, limiting the currency’s natural support.Historically, Japanese authorities have preferred to rely on verbal intervention first, escalating to actual market operations only when moves become disorderly or one-sided. The last episodes of yen-buying intervention were framed as responses to excessive volatility rather than targeting any specific exchange-rate level.The backdrop is complicated by heightened political sensitivity around currency moves. A weak yen boosts export competitiveness but also raises import costs for energy and food, squeezing households at a time when inflation remains a key public concern. That tension helps explain why officials continue to emphasise readiness for “decisive action.”For now, Katayama’s comments stop short of signalling imminent intervention. But by explicitly referencing joint action with the United States and refusing to rule out any tools, Japan has delivered a clear message: authorities are watching closely, and tolerance for rapid or destabilising yen moves is limited. This article was written by Eamonn Sheridan at investinglive.com.

Summary:China is removing high-speed traders’ servers from exchange data centresFutures exchanges in Shanghai and Guangzhou are enforcing the changesDomestic and global trading firms will be affectedLatency advantages for high-frequency traders will be reducedMove aligns with broader push for market stabilityChina has moved to rein in high-speed and algorithmic trading by stripping one of the sector’s key advantages: ultra-fast access to exchange data centres. According to Bloomberg (gated), regulators have directed commodities exchanges to remove client servers, particularly those used by high-frequency traders, from facilities operated by the bourses themselves.People familiar with the matter said futures exchanges in Shanghai and Guangzhou are among those ordering local brokers to relocate servers for their clients out of exchange-run data centres. While the measure affects a broad range of market participants, high-frequency trading firms are expected to feel the greatest impact due to their reliance on minimal latency.Under the current timeline, the Shanghai Futures Exchange has told brokers that servers used by high-speed trading clients must be removed by the end of next month, with other clients facing a later deadline of April 30. The move is being led by regulators and applies to both domestic and foreign trading firms.The clampdown is set to hit China’s large cohort of domestic quantitative funds, while also affecting major global players active in the country. Firms including Citadel Securities, Jane Street and Jump Trading are among those whose access to exchange-proximate servers is being curtailed, according to the people.By forcing servers out of exchange facilities, authorities are undermining the speed advantage that high-frequency traders gain by colocating equipment close to matching engines. Even a delay of a few milliseconds can materially affect strategies in markets where execution speed is critical, particularly in stock index futures, commodities and convertible bonds.Adding to the impact, some futures exchanges are considering imposing an additional two milliseconds of latency on servers connecting from third-party data centres, further narrowing the gap between high-speed traders and other investors.The move forms part of a broader regulatory push to level the playing field and reinforce market stability after Chinese equities and futures rallied to multi-year highs. Regulators have recently tightened margin trading rules and increased scrutiny of certain exchange-traded fund trades, particularly those involving foreign market makers.While high-frequency traders add liquidity, Chinese authorities have long been uneasy about the execution advantages they enjoy. This latest step signals a renewed determination to curb those benefits, even if it reshapes trading strategies and market dynamics. This article was written by Eamonn Sheridan at investinglive.com.

Summary:Trump expected to announce emergency power auction on FridayTech firms would be forced to fund new power plants for data centresPJM would run the auction, potentially backing $15bn of new generationAim is to curb electricity price rises hitting householdsData-centre demand seen as key driver of grid strainPresident Donald Trump is expected to announce an unprecedented intervention in U.S. power markets, unveiling plans for an “emergency power auction” that would require major technology companies to directly fund new electricity generation to support the rapid expansion of data centres.Under the proposal, the country’s largest grid operator, PJM Interconnection, would be directed to run a special reliability auction designed to accelerate the construction of new power plants. The initiative could underpin as much as $15 billion in new generation capacity, according to officials familiar with the plan.The move reflects growing concern within the administration and among state leaders that surging electricity demand from artificial intelligence and cloud-computing infrastructure is outpacing supply, pushing household power bills higher and fuelling political backlash. PJM’s network spans 13 states from the Mid-Atlantic to the Midwest and serves more than 67 million people, making it one of the most exposed regions to data-centre-driven demand growth.Under the proposed structure, technology companies would bid for long-term contracts tied to new power generation, effectively paying to secure the electricity required for their data centres. The aim is to ensure the cost of new power plants does not fall on households, while addressing reliability concerns on an overstretched grid.Trump has repeatedly argued that data-centre operators should bear responsibility for the power they consume, saying this week he does not want American households paying higher electricity bills because of AI infrastructure. Electricity affordability has become a central political issue ahead of November’s midterm elections, with power prices continuing to rise even as fuel costs have eased.U.S. electricity prices have climbed sharply over the past year, with the average retail electricity price rising to a record, adding pressure to household budgets already strained by higher living costs.The administration is framing the auction as a one-off emergency measure rather than a permanent shift in market design, intended to stabilise prices and ensure adequate supply before demand accelerates further. If implemented, the plan could also set a precedent for how other regions manage the collision between AI-driven power demand and aging electricity infrastructure. This article was written by Eamonn Sheridan at investinglive.com.

Earlier:PBOC is expected to set the USD/CNY reference rate at 6.9722 – Reuters estimateThursday:China new bank lending stumbles once again in 2025PBOC to cut rates on various structural policy tools by 25 bpsPBOC injects 86.7bn yuan through 7-day reverse repos at an unchanged rate of 1.4%. This article was written by Eamonn Sheridan at investinglive.com.

Summary:Fed’s Daly says monetary policy is “in a good place” to respond to economic shiftsIncoming data show solid growth, stabilising labour market and easing inflationFed cut rates by 75bps last year to offset labour-market coolingUncertainty remains around both inflation and employment risksDaly signals preference for patience and deliberate calibrationU.S. monetary policy is currently well placed to respond to how the economy evolves, but future decisions will need to be made carefully and deliberately given lingering uncertainties around both inflation and employment, San Francisco Federal Reserve President Mary Daly said on Thursday, US time. Daly said recent U.S. economic data have been encouraging, with growth projections remaining solid, the labour market showing signs of stabilisation, and inflation expected to continue easing through 2026. Taken together, those trends suggest the economy is moving closer to balance after a period of elevated price pressures and cooling employment conditions.Daly noted that the Federal Open Market Committee cut interest rates by a cumulative 75 basis points last year in response to a marked slowdown in labour-market momentum and inflation outcomes that proved milder than previously expected. Those moves, she said, were designed to prevent the economy from weakening too sharply while keeping progress toward price stability intact.Despite the improved backdrop, Daly cautioned that uncertainty remains high. Risks persist on both sides of the Federal Reserve’s dual mandate of maintaining price stability and achieving maximum employment, underscoring the need for a measured approach going forward. “We will need to be deliberate as we calibrate policy,” she said, emphasising that the central bank must balance the risk of doing too much against the risk of doing too little.Her remarks come ahead of the Fed’s January 27–28 policy meeting, where officials are widely expected to leave interest rates unchanged in the current 3.50%–3.75% range after a run of rate cuts last year. In Fed-watcher parlance, Daly’s description of policy being in a “good place” is typically interpreted as signalling comfort with holding rates steady while assessing how earlier easing works through the economy.Daly also stressed that policymaking cannot rely solely on individual data releases. While economic data, analysis and models remain critical, she said direct feedback from businesses, households and communities provides valuable insight into underlying conditions and future trends that may not yet be visible in official statistics.By combining quantitative data with real-world intelligence, Daly said the Fed can better respond to changes in the outlook and ensure monetary policy remains appropriately calibrated as the economy moves into its next phase. This article was written by Eamonn Sheridan at investinglive.com.