Forex online currency trading: According to Reuters. com – The Bank of Japan- BOJ, welcomes a new anti-deflation governor this week. The Bank of England might get a new pro-growth mandate and the Federal Reserve is likely to stick like glue to its aggressive bond-buying program.
Together, the three events speak volumes about the balance of risks in a global economy that is on the mend but still a long way from rude health.
Unemployment is intolerably high in the United States and most of Europe; while growth in many other countries is also well below its pre-crisis trend. As a result, inflation is firmly subdued.
Add to that the inability of many heavily indebted countries to cope with higher borrowing costs, and it is no wonder that central banks will do whatever is needed to keep a lid on bond yields, said Joachim Fels, chief international economist at Morgan Stanley in London.
"Despite the uptick in growth that we see, we don't think central banks are done easing yet," Fels said.
Supportive monetary policy is a big reason why Fels expects the global economy to emerge from the twilight as 2013 unfolds.
Forex online currency trading seems to be a good business considering that the currency market never stops.
THE BOJ BECOMES RELEVANT AGAIN
For once, the Bank of Japan will be an important driver of this global reflation if Haruhiko Kuroda, who takes over at the helm of the central bank on Wednesday, makes good on his pledge to stop Japan's long deflationary rot.
Other central banks will feel the need to remain expansionary if their currencies rise due to yen weakness triggered by bold BOJ easing, Fels said.
Even the European Central Bank could come under a bit of pressure to do more, added Daniel McCormack, a strategist with Macquarie in London.
"Even though expectations are high for some pretty aggressive action from the BOJ, when it does happen and you can hold and see it and it's real, the market will still react positively," he said. Therefore, more people might enroll to Forex online currency trading since the economy is going to be very active.
Regime change of sorts is also in the air at the Bank of England – BOE. Chancellor of the Exchequer George Osborne, Britain's finance minister, is expected to announce a review of the BOE's inflation-focused remit, or possibly outright changes to it, when he presents his annual budget on 20th of March 2013.
With the United States, China and possibly Germany gaining economic momentum, and central banks pushing the accelerator firmly to the floor, equity markets should be in a sweet spot for the rest of the year, McCormack added. This means that for Forex online currency trading the rest of the year should be good as well.