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Forex News and Rumors – Afternoon Update

ECB Council Member Cautions Against Stimulus

Axel Weber – a council member with the European Central Bank [1] – was quoted as saying that the ECB will not exceed €60 billion (US$82 billion) to buy bonds as part of its policy of quantitative easing [2]. Weber also warned against introducing too much money in the economy citing fears that inflation may make a “rapid and powerful comeback”. More [3]

Return of the Japanese Housewife

Investors in Japan – nicknamed “Japanese Housewives” after the women who traditionally managed finances in Japanese households – are betting that the yen will depreciate over the next six months. Japanese investors are seeking higher returns after the Bank of Japan [4] reduced the lending rate to 0.1 percent and are turning to the carry trade [5] to earn the higher interest offered by other currencies including the Australian and New Zealand dollars. More [6]

Record Number of Properties Received Foreclosure Notice in April

The number of US homes receiving foreclosure notices in the month of April rose to a record 342,038 – this breaks the previous record set one month earlier and suggests that banks are stepping up their efforts to seize properties. More [7]

US Treasury to Increase Credit Default Swap Regulations

The US Treasury is expected to release details later today to bolster federal oversight on credit default swaps – the over-the-counter derivatives product that forced American International Group Inc. (AIG) to accept billions in government bail out money to remain solvent. More [8]

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Scott Boyd
Scott Boyd

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