Archive for May 2008

Foreign Exchange Insights and Next Week

Foreign Exchange Insights

May 30, 2008

The dollar continues to march inversely to the beat of oil prices. A sharp 4.7% advance in oil costs during the week to May 23rd had been associated with across-the-board dollar declines. Oil reversed course this past week, and the dollar followed. Both oil and the dollar are now near their levels of two weeks […] More

New Overnight Developments Abroad - Daily Update

New Developments Abroad

May 30, 2008

The dollar is mixed despite lower oil prices. There are dollar losses of 0.3% against the kiwi, 0.2% versus the Aussie dollar, and 0.1% against carry trade-financing currencies like the yen and Swiss franc. The Greenback has risen 0.4% against the C-dollar, 0.2% against sterling and 0.1% versus the euro. Oil fell 0.8% further to […] More

Larry's Blog

Give It Up, Scott

May 29, 2008

In the middle of a presidential election campaign, former White House press secretary Scott McClellan has released a tell-all highly critical expose about the administration for which he worked. Normally, that kind of revelation might be expected to be very damaging to the incumbent Party. Recall, for example, how a report just before the 1992 […] More

New Overnight Developments Abroad - Daily Update

New Developments Abroad

May 29, 2008

The dollar is stronger as markets look ahead to eventual Fed tightening, with gains to 0.7% against the Swiss franc, 0.5% against the euro, 0.4% versus the Aussie dollar, 0.3% against the yen, 0.2% relative to sterling, and 0.1% against the Canadian dollar. The Nikkei leaped 3.0%, and 10-year JGB yields advanced 5 bps to […] More

Currency Markets in the News

Euroland Rundown

May 28, 2008

Elevated inflation is spoiling consumer sentiment in Continental Europe. German consumer prices rose by a faster-than-forecast 0.6% in May. They rose 3.8% saar in the last three reported months and by 3.0% y/y, twice the 1.5% per annum pace in the six years between May 2001 and May 2007. The German PPI advanced 7.6% saar […] More

Currency Markets in the News

Confusion About Japanese Growth

May 28, 2008

Real GDP measures aggregate demand. Japan’s all-industry index calibrates aggregate supply. The two gauges should tell a similar story but aren’t doing so lately. GDP expanded 2.6% saar in 4Q07 and 3.3% in 1Q08. The all-industry index, in contrast, slipped 0.4% saar in the final quarter of 2007 and then slumped by 3.7% in 1Q08. […] More

Upward Rate Risks in Norway and Australia

May 28, 2008

Norway’s central bank, the Norges Bank, kept its benchmark rate unchanged at 5.5% after a policy meeting today. That’s right in the center of a 5-6% range that officials had expected to be observed during 1H08. A statement released today explained why there was no immediate follow-up to April’s 25-basis point tightening but reaffirmed that […] More

New Overnight Developments Abroad - Daily Update

New Developments Abroad

May 28, 2008

Oil prices fell another 1.6% overnight. At $126.78, such are now 6.2% below peak. Gold prices slumped 1.9% to a sub-$900 reading of $895.8/ounce. The dollar is mixed, advancing 0.4% against the yen and 0.1% versus the Swiss franc and C-dollar. The dollar is unchanged against the euro and A-dollar and off 0.1% against sterling. […] More

Currency Markets in the News

German Growth Deconstructed

May 27, 2008

Details of the 1.5% first-quarter jump in German real GDP (6.3% saar) were released today. With that spurt, on-year growth over the past eight quarters has averaged 2.9%. 2006 had been a stronger year than 2007, with faster growth in all four quarters than in the corresponding quarter of 2007. But that trend toward less […] More

Three Factions at the Bank of England

May 27, 2008

British monetary policy is decided by a committee of nine people, who as in many other G7 economies are challenged by weakening growth prospects as well as intensifying inflation. Of the last eight monthly policy meetings, only one resulted in a unanimous decision. Mr. Blanchflower was more dovish than the majority at the other seven […] More

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