Is What's Good for China Good for All of Us?

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Nov. 19 (Bloomberg) -- BNP Paribas' Steven Saywell discusses China's reform plan and Federal Reserve monteary policy with Mark Barton and Anna Edwards on Bloomberg Television's "Countdown." (Source: Bloomberg)

Strategy.

This reform plan has been discussed in recent days.

What are the impacts on the aussie dollar and the new zealand dollar?

There is probably not enough time to go into that.

I think the key point we would focus on is these are significant reforms, and they have continued to support prospects for chinese growth going well, particularly for the rest of this year.

If you look at the response in markets it has been very clear.

There has been a followthrough and currencies for the region.

They are key in our if.

Our view is these currencies will continue to do appreciate.

I think the chinese number certainly feed into that with the asiana take an early moving higher.

The central bank and a straw you released from its last meeting.

A say the rate cuts they have already implemented seem to be working.

I was in australia last week visiting clients and doing some research.

I think the key point we realized is overlooking indicators are very strong.

There is a new government, which stimulated confidence in the economy.

There has been a slowdown, particularly in the mining sink there -- mining sector, but the rba, will there be a followthrough?

I think the chinese number we just spoke about our an extra filler.

-- rn extra filler.

Prospects are looking pretty good.

Let's talk about the japanese currency.

How happy do you think the government is with a yen where it is?

It has just dropped back overnight below that so strengthening.

It is down 19% compared to where it was last year.

Where do you see the currency heading?

Think the authorities are very happy.

I think this is a significant result given that we started at 75. our view is it continues to weaken.

It will be around 120. two things need to happen.

First we need to see a stronger dollar.

We need to see u.s. yields rise.

Also, we would probably need to see more stimulus from the bank of japan.

What drives that weakening of the bank of japan?

The big news of quantitative easing is already out there?

What is going to be the next push?

It is out of the question.

We think what is going to drive it is widening the gaps.

If we are right we get tapering in march and u.s. yields start to rise.

I don't think japanese yields are going anywhere because of the easing.

It is a widening gap that i think will drive the dollar yen higher.

It's not going to happen this week, but this is a fantastic trade.

You are bullish on the dollar.

When do we buy the dollar?

We think these levels are attractive.

The dollar yen is slightly below 100. these are fantastic if you believe we are going to see u.s. growth pick up again and the fed actually start to taper in march.

We think this is a great opportunity for current levels.

Two out of those three have basically said we are going to wait for the economy to improve before we taper.

The same message from bernanke?

Yes, they have been very specific.

There is no predetermined data for tapering.

They don't know either.

If we get above two percent growth next year that's what the fed wants to see.

I think that's going to be the catalyst for the process.

This text has been automatically generated. It may not be 100% accurate.

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