The possibility that both China and India may take their foot off the tightening pedal helped lift their stock markets and the rest of Asia followed. China Securities Journal said the PBOC may stop raising bank reserve requirements and may lean to even lowering the ratio. An Indian news service hinted that the RBI won’t raise rates when they meet next Friday. The BoJ didn’t follow in the foot steps of the SNB in putting a limit on FX appreciation and instead sat on its hands. The yen market is bigger than the Swiss and the battle against the market would be untenable for the BoJ. For the Swiss, their fight against the market will work in the short term but past that will be tough. Either way, the possible ‘unlimited’ Swiss franc money printing by the SNB has taken the race to debase to a whole new level. Germany’s high court said there were no constitutional issues with Germany’s contribution to Greek bailout 1 and the EFSF but said budget votes are still needed for further aid. Italy will have a 1pm est Senate budget vote on its newly proposed plan. No deal was made yet to appease the Fins on their collateral demand in return for its loan to Greece. In the US, the avg 30 yr mortgage rate fell to 4.23%, 2 bps from matching a new low but it wasn’t enough to have any impact on the housing market. Refi’s fell 6.3%, down for a 3rd straight week while purchases rose just .2%. Easing the way for people to refi is now a hot political issue but the lunch is not free. II: Bulls 38.7 v 40.9 Bears 37.6 v 36.6

Category: MacroNotes

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