JOURNALIST ASKING MIKE GALLAGHER: "Mike, support from central banks, PBOC and BOJ as well. Reassuring words from the BOJ, no?"
JOURNALIST: "Yeah. Last time we hit 3% on the 10-year. That spooked equity markets. Do you expect that to happen this time? I mean we've already hit the 3% of course. But how hard are we going to go in and when will equity markets be spooked?"
MIKE GALLAGHER: "I think we're looking for a move to 3.25%. The critical issue is the pace that that arrives. We see that 3.25% taking around about two months or so in early 2014 and that's not a particularly fast pace. And I think if it's that kind of pace, then we could see this continued divergence in terms of price action. I think ultimately equities start to get a bit of a reality check once we get into the spring and then people start debating what's going to come after taper. And I think then you could see equities running into a bit more of a difficult phase in the U S certainly."
JOURNALIST: "We talked about Japan, but this progress towards 2%, how tough is it going to be given the weaker Yen?"
MIKE GALLAGHER: "Well I think the difficult part is getting it from 1% to 2% really. If you look at what Kuroda has said, it's 2% on a sustainable basis. So it's not just hitting 2% and that's it. So I think we very much are of the view that the Bank of Japan will have to take extra action to try and ensure that it does meet the target on a sustainable view. So we're looking for the BOJ to ease policy in April. That's going to be Yen negative. We still got the view of 110 on Dollar/Yen by the spring."