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Hardy: Will the yen hold its nerve?
It’s a case of no rest for the wicked when it comes to investors this month; last week we had five central bank meetings and crucial jobs data out of the US, but the biggest event is yet to come; that all important Fed meeting. And as Saxo Bank’s John Hardy explains, markets remain "nervous" ahead of the tapering decision.
John explains there is a chance the Dollar gets squeezed if the markets stay “scared” ahead of the meeting and that the currency with "most nervousness" is Dollar Yen. He also adds that we can expect a little bit of consolidation from Euro Dollar, but that it’s heading towards the 1.30 level.
Most analysts expect the Fed to ease back on stimulus after the September 17-18 meeting. Ben Bernanke said in May that the central bank would start trimming bond purchases from their current USD 85 billion a month if the US economy improved.
Last week, the latest US jobs data showed unemployment rate declined to 7.3 percent in August, a 4-1/2 year low. However, firms only added 169,000 new jobs last month.
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