October 18,
Is the concern of the market dependent on FRB chairman next term?
Yesterday’s dollar / yen continued to mesh in the lower 112 yen range, almost flat and finished trading. In addition to updating the historical highs on the NY Dow Jones average, the US dollar bond yields have risen to the high level for the first time in about nine years, strong dramatic winds are blowing on the dollar / yen, but at the footsteps, I show almost nothing. The currency market may be concerned about the rate of increase in interest rates next year (three outlooks at present) rather than whether the Federal Reserve interest rate hike is raised in December. To that end, it is strong view that successor to Yellen FB Chairman who will expire in February next year will hold the key.
According to US newspaper reports, the candidate for the next president was narrowed down to five people, Yellen, Warsh, Taylor, Powell and Cohn, President Trump will decide the next chairman before the Asian visit scheduled for November 3 It is. Among them, Ms. Yellen, Mr. Powell, Mr. Cohn are considered to be pigeon faction, but Mr. Taylor and Mr. Warsh are said to be strong hawkish colors.
If the president of pigeon faction will take office, next year’s rate hike will stay less than three times, while if the hawk faction chairman is born it will likely lead to an observation that the possibility of raising the rate more than four times will increase.
The dollar / yen seems to continue nervous market expansion in anticipation of the next race chairman’s selection race.