Bank of Japan left its interest rates at 0.1% and asset purchases unchanged at 5 Trillion Yen while adding that it will steadily buy assets and provide long term funds. The RBA in its minutes of Dec. 7 meeting stated that the decision to keep interest rates unchanged at 4.75% was mildly restrictive given signs of consumer caution and inflation pressures. Higher borrowing costs in Australia helped slow Q3 growth and savings have risen, even as energy and mining investments keep unemployment at 5.2%. The economy slowed in Q3, with GDP increasing at a 0.2% quarterly rate, the weakest pace since a contraction at the end of 2008. The BOJ has kept both interest rates at 0.00%-0.10% this meeting, and left the asset purchase target unchanged. Asian markets traded positive with the Nikkei +1.5%, Hang Seng +1.2% and Shanghai Composite +1.8%. Commodity prices climbed amid easing tensions in the Korean peninsula and China reported concrete action to stabilize Europe. The EURUSD held its ground, moving upto 1.3197 highs after dropping to 1.3095 yesterday as China said it’s taken concrete steps to help the EU with its debt problems and supports the IMF’s measures to help some EU members to counter the debt crisis. China also added they won’t reduce holdings of EU bonds as EU is its largest trading partner. AUDUSD moved to highs of 0.9973 after the RBA minutes, USDJPY traded lower at 83.65 as BOJ kept interest rates unchanged while GBPUSD still holds strong at 1.5540 as Dollar weakened on stronger commodity prices. Today’s calendar includes German consumer confidence survey, Swiss trade balance, exports, imports UK public finances while Canada releases inflation reports and retail sales.

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