Waiting for Yellen’s Testimony

February 11, 2014

Janet Yellen, the new Fed Chairwoman of the Federal Reserve, delivers semi-annual Humphrey-Hawkins testimony at 15:00 GMT before the House Financial Services Committee.  Investors await possible modifications of forward guidance, her thoughts on the state of the economic recovery, and any clarifications of the tapering of monthly asset purchases.

Other than the above eagerly awaited event, it’s been a light day from a data release standpoint.

The dollar is unchanged against the yuan and Swiss franc, up 0.1% versus the yen, and down 0.2% against sterling and 0.1% relative to the euro and loonie.  Bigger drops of 0.9% against the Australian dollar and 0.6% vis-a-vis the New Zealand kiwi have occurred.

The main currency market development, however, has been a 19% devaluation of the Kazakhstani tenge against the dollar to a target mid-point of185.  The tenge, which like many emerging market currencies had been an object of mounting selling pressure, fell 16.3% overnight.

Japan was closed today for National Foundation Day. 

Share prices climbed in overseas markets, rising 1.8% in Hong Kong, 1.1% in the Philippines, 0.8% in China, 0.6% in Australia, 0.5% in Taiwan and South Korea, and 0.4% in Indonesia and Singapore.  In Europe, stocks have risen 0.8% in Spain and Britain, 0.7% in France, and 0.5% in France.

The National Australia Bank reported increases in its monthly readings of Australian business conditions by a point to +4, a 3-year high, and business confidence to a 1-year high of +8, up two points. 

Australian mortgage loans fell 1.9% in December following increases of 1.1% in October and 1.4% in November.  House prices climbed 3.4% last quarter and by 9.3% between 4Q12 and 4Q13.

British same-store sales leaped 3.9% in the year to January, their greatest 12-month increase in 33 months.

South Africa recorded joblessness of 24.1% last quarter, down 0.4 percentage points from 3Q13.  Factory output in South Africa rose 0.4% in the final month of 2013 and by 2.5% from December 2012.

India’s trade deficit in January of $9.91 billion was smaller than forecast because of an 18.3% year-over-year slump in imports.  Filipino exports rose 3.6% in full-2013 but by a much stronger 15.8% between December 2012 and December 2013.

Scheduled U.S. data this Tuesday include weekly chain store sales, the NIFB small business sentiment index, wholesale inventories, and the Labor Department monthly JOLTS index that monitors hirings and firings.

In addition to Yellen’s testimony, Philly Fed President Charles Plosser, a hawk, speaks publicly today.

Canadian Finance Minister Jim Flaherty presents the annual Canadian federal budget at roughly 19:00 GMT.

Copyright 2014, Larry Greenberg.  All rights reserved.  No secondary distribution without express permission.

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