Monday 3rd August 2015
NEWS TICKER, FRIDAY, JULY 31ST: US bond markets expect a $900m issue from the Metropolitan St. Louis Sewer District as early as next year after its rate commission voted yesterday to back the district’s plan to tap the markets. The bonds will continue financing a $4.7bn capital program required by the Environmental Protection Agency (EPA) to keep sewers in St. Louis and St. Louis County from regularly overflowing into area creeks and rivers. Already, the district has put $600m toward sewer projects in St. Louis and St. Louis County. MSD customers can consequently continue to expect annual sewer bill hikes each summer. In 2012, the average customer paid $29 monthly. This month, bills rose to an average of $41. After this bond issue, the monthly sewer bill will cost the average household $61 by 2019 - JP Morgan has hired Lebo Moropa, giving the bank its first dedicated prime brokerage and equity finance presence in South Africa, reports Securities Lending Times. Former HSBC trader Moropa has joined the bank in Johannesburg and will focus on synthetic and cash prime brokerage and securities lending, including delta one and will report to Paul Farrell in London. Moropa was a delta one trader at HSBC and has worked for JP Morgan before– Apulia Finance has informed the Luxembourg Stock Exchange of its intent to issue a securitised paper, backed by residential mortgage loans originated by Banca Apulia. The issue date is August 6th and the deal is lead managed by BNP Paribas who is also joint arranger with Finanziaria Internazionale Securitisation Group. Swap counterparty in the transaction is Canadian Imperial Bank of Canada and the clearers are Euroclear and Clearstream. Funding is at three month Euribor with a spread of 0.40% before the step up date and 0.80% after the step up date. The deal is worth a combined €170m of which €153m are Class A asset backed floating rate notes due 2043; €6.79m Class B asset backed notes and €9,84m are Class C asset backed floating rate notes – all due 2043.

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By OANDA

 

Bank of Japan Pushes the Yen Lower

Friday, 12 April 2013 Written by 
Bank of Japan Pushes the Yen Lower The Bank of Japan (BoJ) captured the attention of the foreign exchange world last week when it started to live up to the expectations of the market. After much anticipation, and lots of preceding rhetoric, Governor Haruhiko Kuroda announced the BoJ’s plan to double its bond buying efforts to reach the 2% inflation target in the allotted two-year window. It was his comments on Prime Minister Shinzo Abe’s inflation goals while still at the Asian Development Bank that might have won him the top job at the Japanese central bank. Earlier this week, the program kicked into gear and the JPY lost 4% versus the USD and 5% versus the GBP. The main beneficiaries have been Japan’s exporters and holders of Japanese stocks with the Nikkei Index reaching new highs on the value of the yen. http://www.ftseglobalmarkets.com/

The Bank of Japan (BoJ) captured the attention of the foreign exchange world last week when it started to live up to the expectations of the market. After much anticipation, and lots of preceding rhetoric, Governor Haruhiko Kuroda announced the BoJ’s plan to double its bond buying efforts to reach the 2% inflation target in the allotted two-year window. It was his comments on Prime Minister Shinzo Abe’s inflation goals while still at the Asian Development Bank that might have won him the top job at the Japanese central bank. Earlier this week, the program kicked into gear and the JPY lost 4% versus the USD and 5% versus the GBP. The main beneficiaries have been Japan’s exporters and holders of Japanese stocks with the Nikkei Index reaching new highs on the value of the yen.

The decision has not been without its critics and some, such as George Soros, cautioned that the fall in the yen could be “an avalanche” that the BoJ could not stop if the Japanese people start to sell the currency. China and South Korea remain critical of the move, branding it a currency war before the Group of Twenty meeting last February. This week, the negative criticism persisted, but the words used were “monetary blackmail” instead of “currency war”. Those ugly words have not been uttered since the Group of Seven made it clear that as long as Japan’s monetary easing means are used for domestic aims, it does not imply unfair currency manipulation.

 



 

Pound Sterling Fluctuations Continue

The GBP is coming off annual lows versus the USD registered in mid-March. The disappointing nonfarm payrolls jobs report released last week in the U.S. boosted the GBP, though it still remains below the 1.54 level. Last Thursday, the U.S. unemployment claims release came in well-below expected estimates and that in-turn could hinder the pound’s recovery as less Americans claimed unemployment support.

 

 

During the week, the pound gained significantly versus the yen after the BoJ’s new round of easing was introduced. Japan’s bond buying program could double the Japanese monetary base by the end of 2014. Though Kuroda is attempting to follow through on his pledge to reach Prime Minister Abe’s desired 2% inflation target within a tight timeframe, he has also said the BoJ’s ambitions are “flexible”.

 

 

Rise of the United Mexican States

Changes in legislation and favourable U.S. economic conditions have pushed the Mexican peso to a 20-month high. The changes introduced by President Pena Nieto’s administration bolstered confidence in Mexico’s media and telecommunications industries. Last month, the Bank of Mexico cut the overnight rate from 4.5% by 50 basis points after the inflation targets were within range. Bank of Mexico Governor Agustín Carstens has called the rise of the peso a reflection of the nation’s economic strength.

 

 

That statement is tough to refute. The MXN has gained 23.55% versus the JPY, 12.2% versus the GBP, and 8.67% versus the EUR since the beginning of the year.

Alfonso Esparza

Senior Currency Analyst, OANDA
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. He covers central banks and global economic and political trends for OANDA. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and financial services marketing from the University of Toronto.

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