New Overnight Developments Abroad - Daily Update

End of August Brings a Ton of Released Data

August 29, 2014

The dollar is unchanged overnight against the euro, sterling and yuan.  The greenback gained 0.2% versus the yen and Australian dollar and 0.1% vis-a-vis the kiwi, while losing 0.2% to the loonie and 0.1% against the Swiss franc. The price of gold has slid 0.3% to $1,286.0 per ounce despite additional military gains by pro-Russian […] Read Article

Foreign Exchange Insights and Next Week

The Political Will to Encourage a Weaker Euro Will Continue to Build and Build

August 27, 2014

ECB officials face difficult choices.  Deflationary risks are not fading as they had hoped.  The confidence of businesses and households has started to flounder.  Investors are readying for quantitative easing (QE).  But there are good reasons why until now QE hasn’t been implemented by the ECB in sharp contrast to central bank policies in Japan, […] Read Article

Central Bank Watch

A Somewhat Peculiar Statement from the Central Bank of the Republic of Turkey

August 27, 2014

The monetary policy committee left its one-week repo rate and overnight borrowing rate unchanged at 8.25% and 7.5%, respectively, but surprised analysts with a 75-basis point cut of the overnight lending rate to 11.25%.  That rate hadn’t changed since a 425-basis point hike to 12.0% on January 29.  At that same time, the repo rate […] Read Article

Deeper Analysis

Sales Tax Hike Causes Greatest Japanese GDP Contraction Since Sendai Earthquake

August 12, 2014

A 6.8% crash in real GDP last quarter reversed a 6.1% annualized jump in the first quarter of 2014, leaving the level of GDP this spring 0.1% less than in 2Q13 and just 1.1% above its level in the second quarter of 2012. Household spending, business spending, imports and residential construction were hammered by the […] Read Article

New Overnight Developments Abroad - Daily Update

A Turn for the Worse in Ukraine and Lots of Data to Peruse

August 28, 2014

Pro-Russian rebels in Ukraine stepped up their attacks, seizing more territory.  Ukraine’s prime minister called the act a de facto invasion by Russia.  Harsher European economic sanctions on Russia appears the likely response. The main market reaction has been in stocks, bonds and gold, not the dollar The U.S. currency is unchanged overnight against the […] More

New Overnight Developments Abroad - Daily Update

Dollar’s Recent Gains Trimmed

August 27, 2014

The dollar has declined overnight by 0.5% against the Canadian and New Zealand dollars, 0.4% versus the Aussie dollar, 0.2% relative to sterling and the Swiss franc and 0.1% vis-a-vis the yuan, yen and euro. While not a big day for scheduled data reports and despite an open-ended ceasefire agreed in Gaza, minor European confidence […] More

Central Bank Watch

Magyar Nemzeti Bank

August 26, 2014

Monetary Council officials signaled last month that a two-year cycle of central bank reductions totaling 490 basis points from 7.0% prior to August 2012 to the current level of 2.10% had been completed.  So it was no surprise to investors to learn today of this month’s Council decision to leave the rate at 2.10%.  A […] More

New Overnight Developments Abroad - Daily Update

Euro Weak but Not Weaker in Early Tuesday Trading

August 26, 2014

The post-Jackson Hole soft tone in the euro continued, but the common currency’s losses haven’t been extended.  Investors believe quantitative easing by the ECB is coming, and there’s speculation of a mutually beneficial accord between Draghi and Yellen to promote euro depreciation.  The euro is trading marginally below $1.32 and lies also south of CHF […] More

Central Bank Watch

Bank of Iceland

August 21, 2014

The Bank of Iceland made a scheduled interest rate announcement on Wednesday.  Iceland’s seven-day central bank interest rate was kept at 6.0%, its level since November 2012.  A released statement observes, “The inflation outlook has improved somewhat since May, and it now appears that inflation will remain close to target during the forecast horizon. A […] More

New Overnight Developments Abroad - Daily Update

Economic Data and Central Bank Plans Occupy Most Attention

August 21, 2014

The Jackson Hole Symposium for central banking begins today. July 30 FOMC minutes released yesterday expressed surprise over the speed of improvement in the U.S. labor market and noted that Fed exit strategy will be anchored around the fed funds target.  Chair Janet Yellen speaks Friday at the Symposium. ECB President Draghi also addresses the […] More

New Overnight Developments Abroad - Daily Update

Wedesday Roundup

August 20, 2014

There’s a firmer tone to the dollar, which advanced as high as $1.3275 per euro and JPY 103.42, which was a 4-month high against the Japanese currency.  Ten-year Treasury, British gilt, and Japanese JGB yields are a basis point higher.  The situation in Ferguson overnight was more orderly. European equities have fallen.  Japan’s Nikkei closed […] More

New Overnight Developments Abroad - Daily Update

Tuesday Highlights

August 19, 2014

The dollar, equities, and sovereign debt yields rose. Perceived geopolitical risks lessened. New Zealand producer prices recorded their greatest quarter-on-quarter drop since 3Q12, and government officials revised growth and inflation forecasts slightly downward for New Zealand. British CPI and PPI inflation decelerated more than expected in July. Euroland recorded current account surpluses in July of […] More

New Overnight Developments Abroad - Daily Update

A Geopolitically Predisposed Market

August 18, 2014

Not much is happening this Monday from a data release standpoint, so market direction has come from geopolitical developments. Russian/Ukraine talks began in Berlin Sunday towards a ceasefire in their border clash. Officials at the German Bundesbank said geopolitical risks have been weighing on Euroland’s largest economy. Russia’s Central Bank widened the Ruble’s allowed trading […] More

Foreign Exchange Insights and Next Week

Next Week

August 15, 2014

For central bank junkies, next Friday is the first day of the Jackson Hole central banker symposium, which is sponsored each year by the Kansas City Fed in late August.  Market-moving news has often emerged from this gathering of the who’s who in central banking.  Minutes from previous meetings of the Bank of England, Reserve […] More

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