Big Week Ahead With FOMC & BOJ Meetings
If you thought the market tremors earlier this year was intense, this super central bank week could trigger an even sharper selloff.
Cross border Yen borrowing - the ultimate engine of the carry trade balloons to a massive 360 trillion yen or USD 2.35 trillion. Global macro traders have used this incredibly cheap debt to finance riskier, high yielding assets worldwide, especially tech giants.
The Bank of Japan is widely expected to aggressively lift its policy rate on Friday to 1.25%. This marks the fastest tightening sequence in half a century. The era of virtually free money in Japan is over.
Fasten our seatbelts. It is going to be a bumpy ride this week.
The copyright of this article belongs to the original author/organization.
The views expressed herein are solely those of the author and do not reflect the stance of the platform. The content is intended for investment reference purposes only and shall not be considered as investment advice. Please contact us if you have any questions or suggestions regarding the content services provided by the platform.