New Overnight Developments Abroad - Daily Update

Many GDP Reports on Final Business Day of May

May 29, 2015

Investors await U.S. and Canadian national income account statistics. First-quarter GDP figures have already been released in many other economies. Swiss GDP fell 0.2% on quarter and slowed to a 1.1% on-year pace from 1.9%.  The result fell short of expectations. Italian GDP rose 0.3% on quarter and 0.1% on year — weak but at […] Read Article

Foreign Exchange Insights and Next Week

Next Week

May 29, 2015

Holidays:  Queen’s Birthday in New Zealand (Monday) and Republic Day in Italy (Tuesday). Special Events:  OPEC meeting in Vienna, release of OECD Outlook, and Greek debt payment to IMF, all on Wednesday. Central Bank Watch:  Policy meetings are scheduled at the Reserve Bank of Australia, Reserve Bank of India, European Central Bank, Bank of England, […] Read Article

Central Bank Watch

Bank of Canada Left Overnight Interest Rate Target at 0.75%

May 27, 2015

The fourth of eight scheduled monetary policy meetings decided the present policy stance is still appropriate but observed that higher oil prices and a softer U.S. dollar in recent weeks, noting that “if these developments are sustained, their net effect will need to be assessed as more data become available in the months ahead.”  The […] Read Article

Deeper Analysis

North American GDP Contracted Last Quarter

May 29, 2015

U.S. and Canadian real GDP declined at similar annualized rates of 0.7% and 0.6% in the first quarter.  Those were the first contractions in four quarters in the U.S. instance and in 19 quarters in Canada’s case.  U.S. nominal GDP fell 0.9%, and the personal consumption price deflator registered an on-year uptick of only 0.3%, […] Read Article

New Overnight Developments Abroad - Daily Update

Confusion around Greek Debt Talks and a Big Drop in Chinese Stocks

May 28, 2015

Greek officials are expressing confidence a deal will be struck within three days.  The IMF and other creditors warn that the sides are still far apart.  Greece has been the main topic as G7 finance ministers and central bank chiefs continue to meet in Dresden, Germany. Chinese equities plummeted 6.7%, most in several months.  The […] More

Central Bank Watch

Magyar Nemzeti Bank

May 27, 2015

The Hungarian central bank base rate was cut in a third straight month on Tuesday, and like reductions in March and April, the size of the move was 15 basis points.  The new level becomes 1.65%, and a statement explaining the latest action retains an easing policy bias. if the assumptions underlying the Bank’s projections […] More

New Overnight Developments Abroad - Daily Update

Calmer Conditions than Yesterday

May 27, 2015

Following the Memorial Day closure, the dollar climbed sharply on Tuesday, sending equities lower including a 190-point drop in the DOW.  Whether the Fed hikes the federal funds target on June 17 remains uncertain.  Richmond Fed President Lacker overnight said his vote hasn’t yet been decided and will hinge on data between now and then. […] More

Foreign Exchange Insights and Next Week

Summer Season

May 25, 2015

The solstice that kicks off astronomical summer still lies almost a month away, but summer for currency market participants has just begun.  In foreign exchange, the year divides into three seasons, not four:  1) before the U.S. Memorial Day holiday, 2) the summer, and 3) what’s left of the calendar year after the Labor Day […] More

Central Bank Watch

Bank of Israel Keeps Existing Policy Stance

May 25, 2015

In a statement affirming the appropriateness of Israel’s 3-month old 0.10% central bank interest rate, officials noted the current sub-zero rate of CPI inflation, 2.1 percentage points below the inflation target range of 1-3%, continuing moderate growth in real GDP, and shekel appreciation since the prior month’s meeting amounting to 3% against the dollar, 1.3% […] More

New Overnight Developments Abroad - Daily Update

Multiple Holidays Dampening Market Activity

May 25, 2015

British markets are closed today for the spring bank holiday. U.S. markets are closed for Memorial Day. A number of northern European markets including France, Germany, Denmark, Norway, Iceland, Austria, The Netherlands, and Belgium are shut too in observance of Whit Monday. The dollar traded under 1.10 per euro to a low of $1.0959 and […] More

Foreign Exchange Insights and Next Week

Next Week

May 22, 2015

Monday Holidays:  U.S. and British markets will be shut May 25 for Memorial Day and a spring bank holiday, respectively, while several Continental European countries observe Whit Monday. Central Banks:  Policy meetings are scheduled in Canada, Hungary and Israel.  The Bank of Japan releases minutes of a prior meeting, and ECB President Draghi and BOJ […] More

Central Bank Watch

South African Reserve Bank

May 22, 2015

In a new statement from South African monetary authorities, officials express mounting doubts that the 5.75% repo rate is sufficiently restrictive to keep inflation in the medium term below the 6% target ceiling. Although the upward revision of the inflation forecast was relatively small, the persistence of medium term inflation at elevated levels and the […] More

Central Bank Watch

No Change in Bank of Japan Policy But Upgraded Assessment of Economy

May 22, 2015

BOJ policymakers took a step away from their easing bias by upgrading their view of Japan’s economic outlook.  The forecast for some time has predicted continuing moderate recovery, but a statement released after four hours 53 minutes of deliberations over two days by the Policy Board expressed greater confidence of the baseline scenario, and Governor […] More

New Overnight Developments Abroad - Daily Update

Memorial Day Weekend Finds Spotlight on BOJ, China and Germany

May 22, 2015

U.S. markets will be closing early ahead of the Memorial Day Weekend. The dollar strengthened overnight by 0.8% against the euro and Aussie dollar, 0.7% relative to the Swiss franc and loonie, and 0.2% vis-a-vis the yen and sterling.  The kiwi is unchanged. West Texas Intermediate oil fell back under the $60 threshold to $59.82 […] More

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