The yen leads gains as risk fizzles with possibility of G7 disappointing
The yen is leading the charge to start the day but majority of the flows came after an earlier report saying that the G7 communique may not give a firm directive on fiscal spending or monetary policy help to the market.
That said, you can sort of understand why they don't want to pre-commit to such a decision - especially with the likes of the ECB and BOJ practically out of ammunition.
But after Australia's move today, I reckon one can bank on the Fed to cut as well with the Bank of Canada also likely to follow suit tomorrow.
However, the willingness to ease policy is one thing. The real question is, will it be effective?
As the coronavirus outbreak continues to take a toll on the global economy and produce a supply-side shock, it is hard to see monetary policy making much of a difference in the grand scheme of things. But we'll see.
For today, equities have seen early gains pared back as Treasury yields continue to stay pressured going into European trading. That is keeping the yen bid with the franc also inching slightly higher at the moment.
The pound is also keeping mild gains with cable looking to push towards 1.2800 as EUR/GBP backs off from a test of the 200-day moving average.
It looks like it could be another choppy session for risk before Wall Street comes in to settle the debate once again but what's not to like about the volatility? :D
