New Overnight Developments Abroad - Daily Update

U.S.-Sino Trade Tensions and U.K. Tory-Labor Brexit Talks Take a Turn for the Worse

May 17, 2019

Chinese officials poured cold water on hopes that trade tensions with the United States might de-escalate. In reaction, China’s stock market tumbled 2.5%, and the yuan fell 0.4% against the dollar. Share prices also dropped 1.5% in Hong Kong, 1.3% in India, 1.2% in Indonesia, 0.9% in Taiwan, 0.6% in South Korea and 0.8% in […] Read Article

Foreign Exchange Insights and Next Week

Next Week

May 17, 2019

Central Banks: Monetary policy reviews are scheduled in Iceland, Israel and South Africa. Minutes of prior meeting to be published by the Federal Reserve, European Central Bank and Reserve Bank of Australia. Fed officials speaking publicly next week include Chairman Powell and Barkin, Daly, Kaplan, Bostic, Bullard, Evans and Rosengren. Draghi and Praet of the […] Read Article

Central Bank Watch

National Bank of Romania

May 15, 2019

Board members of the National Bank of Romania did not raise their monetary policy rate further despite enumerating several concerns. Inflation has risen to 4.1%, and officials project that such will “remain above the variation band of the target during the next three quarters and thereafter return to and stay in the upper half of […] Read Article

Deeper Analysis

Tale of the Tape: DJIA Performance of Trump Vs Obama

May 13, 2019

With a plunge of more than 600 points so far today, the Dow Jones Industrials has fallen to its level at the start of the second week of January 2018, some 16 months ago. During the equivalent period of the Obama Presidency, the DJIA climbed 18%. Okay, the DOW is still 27.5% above its level […] Read Article

New Overnight Developments Abroad - Daily Update

Little Overnight Change in the Dollar but European Stocks Firming Further

May 16, 2019

The dollar shows no net change against the euro, Swiss franc, Australian dollar, or yuan. The greenback has risen 0.2% against sterling and 0.1% relative to the yen but is down 0.3% versus the loonie and peso and 0.2% against the kiwi. European equity markets have thus far today risen 0.9% in Switzerland, 0.7% in […] More

Central Bank Watch

National Bank of Poland Reference Rate Maintained at 1.5%

May 15, 2019

Four just over four years, the reference central bank rate in Poland has been at 1.5% since a pair of 50-basis point cuts in January and March of 2015. That’s the longest span between changes. In a released statement, the conclusion that 1.5% represents an appropriate stance was explained as follows: The outlook for economic […] More

New Overnight Developments Abroad - Daily Update

A Fresh Worry: Chinese Growth Slowed Last Month

May 15, 2019

Asian stock markets had taken the North America upward cue, posting gains on Wednesday of 1.9% in China, 0.6% in Japan and Hong Kong, 0.4% in Taiwan, and 0.5% in South Korea but that was before news of soft Chinese industrial production, retail sales, and business investment. In European trading, stocks are down 1.0% in […] More

New Overnight Developments Abroad - Daily Update

Dead Cat Bounce

May 14, 2019

The escalation of trade war hostilities between the U.S. and China rattled global financial markets significantly yesterday, but today’s mood has been more encouraging. Share prices in Europe are up so far by 1.2% in France, 1.0% in the U.K. and Italy, and 0.9% in Germany. In Asia, equities fell 1.8% in Hong Kong, which […] More

New Overnight Developments Abroad - Daily Update

Fear of a U.S.-Sino Trade War and Fear of a U.S.-Iran Real War Send Shivers to Investors

May 13, 2019

U.S. President Trump was particularly provocative over the weekend even by his own standards. Trade talks stalled with China, and he’s threatening a further escalation if China retaliates against the higher U.S. tariffs imposed last Friday. Tighter U.S. economic sanctions against Iran and a reinforced show of military force in the middle east threaten to […] More

Foreign Exchange Insights and Next Week

Next Week

May 10, 2019

Central Banks: Monetary policy reviews planned in Mexico, Indonesia, Poland and Romania. Lane of the Bank of Canada and Bullock of the Reserve Bank of Australia will be speaking publicly. Events and Holidays: There’s a monthly Eurogroup meeting Thursday. Hong Kong will observe Buddha’s Birthday on Monday, and Friday is Norway’s Constitution Day. Scheduled U.S. […] More

New Overnight Developments Abroad - Daily Update

Tariff War

May 10, 2019

President Trump made good on his threat to lift tariffs on $200 billion of imports from China, and Beijing officials promise to answer in kind even as talks continue. Trump erroneously expects the U.S. economy to at worst react neutrally to an escalated tariff war, but that delusion only partly explains his likely motivation. The […] More

New Overnight Developments Abroad - Daily Update

Share Prices Down as U.S. and China Exchange Mutually Destructive Tariff Threats

May 9, 2019

It’s crunch time in the U.S.-Sino trade negotiations, and investors are hedging against the worst. The dollar climbed 0.6% against the yuan overnight. The price of Comex gold firmed another 0.2%, while WTI oil slid 0.3% and under $62. The 10-year U.S. Treasury yield popped higher after a poorly received Treasury auction yesterday but then […] More

Central Bank Watch

Central Bank of Malaysia Eases Monetary Policy While Bank of Thailand Passes

May 8, 2019

Bank Negara Malaysia’s Overnight Policy Rate was sliced to 3.0%, reversing a 25-basis point hike engineered in January 2018 and restoring the stance that had existed from July 2015 until that change in early 2018. A released statement notes, “there are some signs of tightening of financial conditions. The adjustment to the OPR is therefore […] More

Central Bank Watch

Reserve Bank of New Zealand Cuts Official Cash Rate to 1.50% from 1.75%

May 8, 2019

Today’s central bank interest rate cut is the eighth of this easing cycle but the first since a similar-sized reduction 30 months earlier. Quarter percentage point cuts also were made in June, July, September and October of 2015 and in March and June of 2016. Policy continues to have a downside bias. A released statement […] More

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