Nov. 6. Fed"s Plosser is being quoted in the NY Times this afternoon, stating that he is against rate cuts unless the economy slows below forecast. He also adds that he sees Q4 GDP slowing to 1.0-1.5% and thinks that last week"s rate cut was a close call. US bonds followed the stock markets and rumors today, with the bond yields hitting highs this morning around 4.375% on the ten years, before falling to 4.31% on rumors of more investment bank losses and in reaction to a slide in stocks. But more denials of losses and a strong 100 pt surge in the DJIA into the close lifted yields back to the morning highs.
USD/JPY is at 114.73, underpinned by the recovery in stocks and fresh highs in the dollar bloc carry trades. Plosser's comments add to the view that despite current volatility in the markets, the Fed will not move to cut rates in December,