/**/wistiajson1({"captions":[{"id":633604,"language":"eng","english_name":"English","native_name":"English","right_to_left":false,"hash":{"lines":[{"start":2.982,"end":4.77,"text":["Hi, this is Tomoko Iwakawa."]},{"start":4.77,"end":6.84,"text":["Welcome to Global Perspectives."]},{"start":6.84,"end":9.54,"text":["By the middle of this week,","the Fed Funds futures market"]},{"start":9.54,"end":13.17,"text":["had already given a 100% chance","that the Fed would raise rates"]},{"start":13.17,"end":15.78,"text":["by 25 basis points next week."]},{"start":15.78,"end":17.58,"text":["The long term","treasury yield also"]},{"start":17.58,"end":20.03,"text":["went up to its highest","level since the beginning"]},{"start":20.03,"end":22.95,"text":["of this year, to","around 2.6%, and it"]},{"start":22.95,"end":26.144,"text":["started to affect the","international bond yields, too."]},{"start":26.144,"end":27.81,"text":["The focus in the","foreign exchange market"]},{"start":27.81,"end":29.73,"text":["has shifted from short","term interest rates"]},{"start":29.73,"end":32.34,"text":["to the longer term","interest rates."]},{"start":32.34,"end":34.83,"text":["So in Europe, the 10","year [? bunt ?] yields"]},{"start":34.83,"end":37.72,"text":["have gone up in the same","magnitude as the US treasury"]},{"start":37.72,"end":39.09,"text":["yield has."]},{"start":39.09,"end":41.37,"text":["This is because there","are some hawks already"]},{"start":41.37,"end":43.86,"text":["within the ECB that","are calling for an end"]},{"start":43.86,"end":47.19,"text":["to the quantitative","easing, sooner than later."]},{"start":47.19,"end":49.56,"text":["The Euro zone's","inflation rate is already"]},{"start":49.56,"end":51.66,"text":["at the targeted 2% level."]},{"start":51.66,"end":55.65,"text":["And given that the ECB's mandate","is only to control inflation,"]},{"start":55.65,"end":57.84,"text":["this is somewhat justified."]},{"start":57.84,"end":60.54,"text":["Consequently, the European","interest rates in the shorter"]},{"start":60.54,"end":62.23,"text":["end have been unchanged."]},{"start":62.23,"end":63.99,"text":["However, the","inflation expectation"]},{"start":63.99,"end":66.0,"text":["is embedded in the bond yields."]},{"start":66.0,"end":69.9,"text":["Meanwhile in Japan, the JGB, the","Japanese Government Bond yields"]},{"start":69.9,"end":72.9,"text":["are also trying to rise,","but have been suppressed."]},{"start":72.9,"end":75.18,"text":["Japan also is","experiencing a pickup"]},{"start":75.18,"end":78.66,"text":["in the inflationary pressures","with the cheap Yen and rising"]},{"start":78.66,"end":80.02,"text":["oil prices."]},{"start":80.02,"end":82.95,"text":["However, what's stopping","the JGB yields from rising"]},{"start":82.95,"end":86.7,"text":["is precisely because of the","Bank of Japan's monetary policy"]},{"start":86.7,"end":91.35,"text":["of targeting 10 year","JGB yields close to 0%."]},{"start":91.35,"end":94.59,"text":["So every time when the","JGB yields tries to rise,"]},{"start":94.59,"end":97.53,"text":["the Bank of Japan is there to","buy the Japanese government"]},{"start":97.53,"end":99.0,"text":["bonds."]},{"start":99.0,"end":101.94,"text":["My view, given that the","10 year [? bunt ?] yields"]},{"start":101.94,"end":104.58,"text":["have risen faster than the","Japanese government bond"]},{"start":104.58,"end":108.15,"text":["yields, this explains why the","Yen has been cheaper or weaker"]},{"start":108.15,"end":109.53,"text":["than the Euro."]},{"start":109.53,"end":111.33,"text":["This trend will","probably continue"]},{"start":111.33,"end":114.21,"text":["until the Bank of","Japan loosens its grip"]},{"start":114.21,"end":117.39,"text":["and allows a further steepening","of their yield curve."]},{"start":117.39,"end":119.43,"text":["Until then, I believe","that the trend"]},{"start":119.43,"end":123.27,"text":["of a weaker Yen in comparison","to the Euro will continue."]},{"start":123.27,"end":124.54,"text":["Thank you very much."]},{"start":124.54,"end":126.38,"text":["Have a great weekend."]}]},"key":"wistia-production_633604"}],"preferred_languages":["eng"]})