Week in FX Asia – After G20 Aso Comments Will Have Been Forgotten

The market may be confused about what Japan’s Finance Minister Aso said or did not say. However, no one can be confused about Abeconomics and what it is supposed to achieve. Japan was very much likely to, and may still do, come under pressure at the upcoming G20 meeting, February 15–16, to slow down the pace of Yen’s weakness.

So what are Japanese officials to do? Do what the Chinese like to do before visiting US dignitaries land ashore. They apply ‘smoke and mirror tactics’ and gently guide the CNY higher. It’s all about perception. It seems that Finance Minister Aso has become Japans sacrificial lamb. His comments that the yen had weakened more than the officials expected or intended to expresses his governments desire to make some G20 friendly comments.

Aso remarks are only stalling the inevitable, a weaker yen. The two-way action seen since his questionable ‘faux pas’ has promoted a timely correction, it will not stop the market trend. Japan cannot be signaled out at the G20. Other Central banks are also expanding their balance sheets. Japan is using monetary policy its not using rhetoric like ECB’s Draghi and his fellow cohorts.

After G20 the market will once again turn its attention to the BoJ and its new governor for further weakening signals.

• USD/INR – Official Estimates put 2013 Growth at 5%
• USD / TWD – Expansion in Manufacturing Sector as Taiwan PMI continue rise
• China Trade Rebounds in January
• China Inflation Falls to 2 Percent
• Japan China Trade Rises 10 Percent YoY
• Japan Surplus is Smallest on Record
• Australia Controversial Mining Tax Falls Below Expectations
• Chinese CPI meeting expectations despite much higher exports and imports levels
• RBA Lowers Inflation Forecast as AUDUSD Set for 4th Week of Falls
• China’s Economic Rebound Intact on Latest Data
• Export Growth Has Yuan Advancing Most in Four Weeks
• AUS/USD Falls Below 1.03 Amid Risk Aversion
• China imported record Gold amounts in 2012
• Phillippine: Higher Imports mitigate Peso Gains
• Central Bank Watch
• BoJ Governor Departure Hints at More Aggressive Central Bank
• AUD/USD – RBA Holds Rates with Dovish Outlook
• Failed to open page
• USD / THB – Industralist wants BOT to start intervention ala BOJ style

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