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Strategies & Market Trends : Galapagos Islands -- Ignore unavailable to you. Want to Upgrade?

To: X Y Zebra who wrote (5728)	10/8/2002 8:00:19 PM
From: X Y Zebra	Read Replies (1) \| Respond to of 57110

forexnews.com October 8, 7:00 PM: EUR/$..0.9792 $/JPY..124.10 GBP/$..1.5519 $/CHF..1.4970` Japanese Forex Trading Preview by Korman Tam At 1:30 AM September Consumer Confidence Index (exp 43.5, prev 44.1) The greenback was higher in Tuesday trading, boosted by stronger equities and a move by President Bush to seek a court injunction to end the West Coast Port Lockout. Meanwhile, weaker fundamentals and lingering uncertainties over Japan's reform measures continue to weigh down the yen. In the Bank of Japan's upcoming report, it is expected they will urge the government to inject additional liquidity into banks if their capital bases are weakened following a stricter assessment of their non-performing loans. According to the Kyodo News, the BoJ also plans to call on the government to compile safety-net measures to ease shocks triggered from the domino effect of corporate bankruptcies anticipated from the accelerated bad-loan disposal. The report, which is expected later this week, says public funds should be injected into banks promptly if necessary. The BoJ's report also cites the nation's bad-loan problem as the main obstacle in combating deflation. Meanwhile, despite the heightened concern over the health of the economy, the government is expected to keep its assessment of the current state of Japan's economy unchanged for the third consecutive month in its October report. However, a cabinet official says the upcoming report will use more cautious language to indicate the government's acknowledgment of a slowdown in the economic recovery. In an attempt to clarify his prior comments, which helped send the Nikkei to its largest one-day drop since July, Financial Services and Economics Minister Heizo Takenaka said his remarks on possible big bank failure were not linked to policy. Recall on Monday Takenaka stated that no bank was too big to fail, resulting in markets to interpret his words as a signal of the government's ever toughening stance on bad loans. Takenaka also felt compelled to allay market fears by stating yesterday the government is creating an environment for stocks to rise, and that he sees Tokyo stocks rising if proper policies are implemented. Takenaka, understanding that his words could trigger the very situation they are trying to ward off, is walking a fine line between sounding too callous and trying to keep fears of a financial meltdown at bay. According to former Vice Finance Minister Eisuke Sakakibara, aka Mr. Yen, Takenaka could become the 'second Yanagisawa'. Sakakibara, speaking in New York, questioned the potential impacts of the government's reform proposals, saying the aggressive disposal of non-performing loans could intensify deflationary pressure by causing bankruptcies and more unemployment. With regards to the foreign currency market, he said he does not expect dollar weakness in the next six weeks even in the event of a U.S. invasion on Iraq.