Market's await BoJ main event - Westpac

Analysts at Westpac offered a market wrap as markets awaited today’s Bank of Japan announcement.

Key Quotes:

Global market sentiment: As markets awaited today’s Bank of Japan announcement (expecting more stimulus) US interest rates fell slightly but the US dollar rose. Oil prices fell to a three-month low but iron ore made a three-month high.

Interest rates: The week-old decline in US 10yr treasury yields extended slightly to 1.49%, while 2yr yields fell to 1.71%.  Market pricing of the Fed funds rate saw little change, implying a 25% chance of a rate hike in September, a 55% chance by December, and 100% by Nov 2017.

Currencies:  The US dollar index staged a minor rebound overnight. EUR fell from 1.1120 to 1.1069. USD/JPY bounced off 104.49 to 105.51. AUD slipped from 0.7549 to 0.7495. NZD fell from 0.7121 to 0.7063. AUD/NZD rose from 1.0580 to 1.0633.