Need to be careful - lots of nuances. Market started with Takaichi trade expecting fiscal dovishness and pressure on BOJ not to hike.
What's bigger for Treasury market - Japanese politics, US data, or China directive?
Lizzy Burden
Jane Foley
China has been trimming holdings anyway. Japan is biggest owner. November data shows Treasury holdings at record high with Japan, UK, Canada, Belgium increasing.
Economists say data could show weak hiring/spending plus high inflation - too pessimistic?
Lizzy Burden
Jane Foley
Activity data hasn't been that bad - retail sales, consumption patterns. Higher inflation may be transient. Market still anticipating three rate cuts this year.
How much sterling drop if Starmer quits?
Lizzy Burden
Jane Foley
Depends who takes over. Market won't like left-wing Labour leader, could show relief for Blair-esque candidate.