Foreign Exchange Insights and Next Week
Weekly Foreign Exchange Insights: October 31st
October 31, 2008
Currency and equity markets were strongly correlated in October, each moving to the ebb and flow of risk aversion. There was a massive unwinding of yen carry trades during the month as risk aversion fell to nil but not so much during the final week of the month as money markets thawed somewhat. When risk […] More
Uncategorized
Back By Popular Demand: U.S. Economic Track Records Under Different Presidencies
October 31, 2008
Back in August a week prior to the U.S. national party conventions in Denver (Dem) and Minneapolis (Rep), this site reported findings from an examination of how U.S. real GDP, employment, consumer prices, stock prices, and the dollar performed when the president was a democrat versus times when the chief executive had been a republican. […] More
No Immunity For Canada
October 31, 2008
Canada does many things right. The government budget has been in surplus for 11 straight years. Core inflation is below but close to 2.0%. The current account surplus equaled 0.9% of GDP last year and 1.7% of GDP in the spring quarter of this year. But being so entwined with the U.S. economy in its […] More
Central Bank Watch
Bank of Japan Fails Test of Policy Presentation
October 31, 2008
Japanese officials in the past fortnight had gone to great lengths to promote a softer yen and firmer share prices. Nice progress was being made toward each goal until the Bank of Japan bungled the public relations surrounding today’s rate cut and release of new economic forecasts. The presentation of central bank policy is often […] More
New Overnight Developments Abroad - Daily Update
New Overnight Developments Abroad: Crisis Re-escalates
October 31, 2008
The Nikkei sank 5.0% when the Bank of Japan Policy Board split on the size of its rate and did a move of only 20 basis points to 0.3%. The Dax is 4.0% lower, and the Ftse (-1.4%) and Paris Cac (-1.7%) are lower as are U.S. stock futures. Asian stocks were mixed, falling 2.5% […] More
Currency Markets in the News
Friday Spotlight on Japan
October 30, 2008
The Bank of Japan’s semi-annual Outlook for Economic Activity and Prices heads a crowded events and data calendar, which will project Japan and the yen into tomorrow’s spotlight. Anticipation of that report and a simultaneous cut in BOJ rates sent the Nikkei up 10% today and extended the yen’s retreat from last Friday’s peak of […] More
New Overnight Developments Abroad - Daily Update
New Overnight Developments Abroad: Nikkei Jumped 10% Amid BOJ Rate Cut Speculation
October 30, 2008
The Bank of Japan is expected to halve its overnight rate target tomorrow to 0.25%. Central banks eased yesterday in the United States, China, and Norway. Central bank rate cuts have occurred today in Taiwan of 25 basis points to 3.0%, Hong Kong of 50 bps to 1.5% and Bahrain of 125 bps to 3.5%. […] More
Central Bank Watch
FOMC Statement and the Dollar
October 29, 2008
The FOMC voted unanimously to do what most analysts expected, cut the Fed funds target and discount rate by 50 basis points to 1.0% and 1.25%. The released statement suggests a continuing bias to cut rates. It reads more dovishly than the statement from the prior pre-scheduled meeting on September 16th, which had been held […] More
Central Bank Watch
Norges Bank Cuts Benchmark Rate 50 Bps For Second Time This Month
October 29, 2008
The Norges Bank implemented its second half-percentage point benchmark rate reduction in two weeks. The one on October 15th was the Norwegian central bank’s first easing since a cut to 1.75% in March 2004. In increments of 25 basis points from mid-2005 until mid-2008 including twice in 2008 and seven times in 2007, the rate […] More
Vital Market Signs at Selected Prior FOMC Meetings
October 29, 2008
EUR/$ $/JPY 10Y, % DJIA Oil, $ 06/30/04 1.2173 109.44 4.63 10396 37.95 06/30/05 1.2090 110.89 3.96 10370 57.00 06/29/06 1.2527 116.07 5.20 11077 73.41 06/28/07 1.3452 123.17 5.10 13456 69.82 08/07/07 1.3749 118.55 4.73 13510 72.27 09/18/07 1.3888 115.75 4.51 13475 81.42 10/31/07 1.4458 115.28 4.42 13873 93.59 12/11/07 1.4682 111.49 4.11 13645 […] More
