By ForexMansion.com

 

As tomorrow’s central bank decisions from the ECB and BoE are looming, market participants are positioning themselves for what will be a stormy day. Markets have turned cautious this week yet with a tendency towards some riskier assets as Japan saw progress in its battle to contain the nuclear crisis.

The US FOMC Meeting Minutes report on Tuesday confirmed that the economy is making a stable progress which improves its economic outlook, yet it showed there are concerns about inflation, and that the Feds’ members are split about whether there is a need to tighten their monetary policy later this year or not.

Asian markets ended the day with gains as BoJ is preparing to take more actions to help the economy through the worst disaster since World War II, and might implement more easing policies. Meanwhile China raised again last night its interest rates for the fourth time since October in an attempt to keep inflation under control.

The credit crisis in Europe seams to be deepening after Moody’s downgraded Portugal’s credit rating for the second time in less than a month. More confirmation about the economic situation in Europe will come today through the Final GDP report for the fourth quarter, expected to show the economy grew by 0.3%.

Germanywill release today its factory orders, while the US will publish its crude oil inventories. The UK released today its industrial production report for February, which fell to -1.2%, dragging the pound sharply to the downside, on fears the central bank will no longer consider an interest rate hike anytime soon, unlike Europe, as the economic performance is weakening.

Oil prices are very well sustained above the 107 level due to the developments seen in Libya and the Middle East, raising concerns about how the global economy will perform if oil will continue to be elevated, since it will inflict more inflationary pressures as food and energy prices will incline.

Gold reminded us that there are investors who are still nervous, as it saw a new recode high today at 1458.80 dollars.  While silver rose to the highest in 31 years at 39.48 dollars per ounce, since metals are believed to be the safest investment amid all the developments seen from around the globe.

Originally posted here