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Last week, global market continuously witnessed the loose monetary policies from the major central banks, namely Bank of England (BOE) and Bank of Canada (BOC). According to reports released on April 14, the BOE decided to keep the bank rate unchanged at 0.5% once again, the record seven-year low. BOC’s announcement for the day before also stated that the target for overnight rate was maintained at 0.5 percent. Due to a slow start to 2016, the loose monetary policy is preferred to prevent the nation’s economy from deflation.
On Tuesday, despite IMF’s comment that BOJ’s intervention had not been effective as it did, officials from Bank of Japan restated that the central bank is ready to continue carrying on the quantitative easing while the yen’s strength has been excessively for the last few weeks.
The tone of the market has been a slowdown as the drawbacks come from energy market. The US Energy Information Administration (EIA) last Wednesday reported that the oil stockpiles for the week ended at April 8 increased 6.6 million barrels. Meanwhile, OPEC on Thursday warned that the global demand for oil was lower as well as the out freeze prospect sees no bright future at the producers’ meeting held Qatar on Sunday. After the information, the oil prices edged down significantly.
The International Monetary Fund is on schedule of meeting this weekend. According to the preliminary comments, the market outlook is faced with uncertainty as the weak data from global economy. Although the risks to growth is on the downside, more positive signals are needed to firm up the economies.
Japan’s trade balance is scheduled to release on April 19, with the forecast of standing at 0.45 trillion, about 2.5 times higher than the previous reading of 0.17 trillion. The expectation comes as a result of BOJ’s willingness to continue depreciating the yen in order to meet the target 2% in inflation.
In addition to important data from economies, the market focuses on commentaries of officials from central banks next week. Their stances on global economic situation will bring effects on investor’s sentiment and determine whether the market get into a flurry or not.
In the end of next week, the ECOFIN will hold a meeting, discussing about Europe’s recent matters. Some solutions to stop the current slowdown and recover the economy are awaited.