New Overnight Developments Abroad - Daily Update

Sovereign Debt Yields Fall Further Despite FOMC Minutes

February 23, 2017

10-year sovereign debt yields are down 5 basis points in The Netherlands, 4 bps in France (helped by a Macron/Bayrou political agreement to support one another against the Far Right), 3 bps in Britain, and 2 bps in the U.S. and Germany. Minutes from the FOMC meeting of January 31/February 01 reveal a widely held […] Read Article

Foreign Exchange Insights and Next Week

Some Factors to Consider When Handicapping Dollar’s Outlook

February 21, 2017

Fake News that is likely to become even more prevalent will present many challenges to currency forecasters. Even if the U.S. press and the intelligence community try to stand their ground, the executive branch of government enjoys great advantages in creating doubt and confusion in the public’s mind over what to believe. The two watchdogs are […] Read Article

Central Bank Watch

Bank of Korea

February 23, 2017

South Korea’s central bank retained a 1.25% Base Rate as was expected. That’s been the level for the past eight months. A 25-basis point reduction in June 2016 broke a one-year-long period with no change. Four 25-bp reductions had been implemented in August and October of 2014 and then March and June of 2015. A […] Read Article

Deeper Analysis

FOMC Minutes

February 22, 2017

Minutes from the January 31/February 01 meeting of the Federal Open Market Committee policy review revealed little information that contradict general perceptions of the current thinking and contingent intentions of policymakers. The meeting was the first after the one in December that had raised the federal funds target by 25 basis points. Donald Trump had […] Read Article

Central Bank Watch

Another Brazilian Central Bank Rate Cut

February 22, 2017

Brazil’s monetary policy committee known as Copom has reduced its Selic interest rate by 75 basis points for the second time in six weeks, and as in January the decision today was made unanimously. In conjunction with 25-basis point reductions last October and November, the Selic rate of 12.25% now stands two whole percentage points […] More

New Overnight Developments Abroad - Daily Update

Euro Dips Briefly Below $1.05

February 22, 2017

Concerns that European nationalism may break the EU apart caused the euro to dip to an overnight and 6-week low of $1.0493 and 10-year sovereign debt yields to fall five basis points in The Netherlands, 4 bps in Germany, 3 bps in France, Italy and Britain. Equity markets in Continental Europe are down 1.0% in […] More

New Overnight Developments Abroad - Daily Update

Fed Policy Still a Huge Influence on Dollar

February 21, 2017

The dollar appreciated broadly after the three-day U.S. holiday weekend despite ongoing worries about U.S. policies and strong preliminary February purchasing manager survey results for Euroland and Japan. The prime dollar mover came from remarks by Philadelphia Fed President Harker that a rate increase is possible as soon as the FOMC’s March meeting. Dollar overnight gains […] More

New Overnight Developments Abroad - Daily Update

North American Holidays Dull Activity

February 20, 2017

The U.S. and Canada are closed for Presidents Day and Family Day. The dollar fell overseas by 0.4% against sterling. Britain’s House of Lords will be discussing whether to amend how Article 50, which will govern the Brexit process, is to be triggered. The dollar climbed half a percent against the rand. South African Finance […] More

Foreign Exchange Insights and Next Week

Next Week

February 17, 2017

Central Bank Activity: Interest rate policy meetings scheduled in South Korea, Brazil and Colombia. Minutes from prior policy meetings to be released by the Federal Reserve and Reserve Bank of Australia. The Cleveland, Philadelphia and Atlanta Fed presidents (Mester, Harker, and Lockhart) speak publicly as does the Reserve Bank of Australia Governor Lowe. February 20th […] More

New Overnight Developments Abroad - Daily Update

Commodities, Bond Yields, Stocks and Sterling Lower

February 17, 2017

The dollar gained 0.5% against sterling, which was depressed by a poor report on British retail sales. The greenback also rose 0.4% versus the kiwi, 0.3% vis-a-vis the Australian dollar, 0.2% relative to the euro, Swiss franc, yuan, and peso. But it lost 0.4% against the Japanese yen. Prices for copper and other industrial metals […] More

Central Bank Watch

Bank Indonesia

February 16, 2017

The BI Board kept its seven-day reverse repo rate at 4.75%. It was cut last year six times between January and October, each time by a quarter percentage point. A statement released today projects 5.0-5.4% growth in 2017, an improved balance of payments last quarter and in-target inflation (3-5%) during the forecast horizon. Indonesia has […] More

New Overnight Developments Abroad - Daily Update

Markets React to ECB Minutes

February 16, 2017

Published minutes from the last ECB meeting (known as the ECB Account) allayed concerns that the recent spike in inflation to around the central bank’s target would not lead to an abandonment of the current easy stance. The rise of headline inflation was caused by energy and shows no visible sign of indirect or second […] More

Foreign Exchange Insights and Next Week

Dollar Uptrend Back on Track

February 15, 2017

The dollar is back in the saddle. After a strong performance last autumn, the dollar hit a speed bump in January but experienced solid demand in the first half of this month. Against both the euro and yen, the U.S. currency posted gains in each month of last quarter. So far in February, it has recovered […] More

Central Bank Watch

Swedish Riksbank Retains Very Accommodative Stance

February 15, 2017

The central bank executive board Kept the repo rate at negative 0.50%. Released a statement proclaiming a further rate cut to be likelier in the near term than any hike and forecast the repo rate no higher than zero even as late as the first quarter of 2019. Agreed to continue quantitative stimulus (bond purchases) […] More

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