Larry's Blog
Next Week
November 28, 2008
Central banks in New Zealand, Australia, Britain and Euroland hold interest-rate policy meetings next week. All of them will implement a cut of at least 50 basis points, and probably probably will slash by as much 100 bps. Conceivably, each will make a move of as much as 75 bps, although the consensus surrounding the […] More
Foreign Exchange Insights and Next Week
Weekly Foreign Exchange Insights: November 28th
November 28, 2008
The defining moments for currency markets during 2008 have not come from released data, other than the cumulative realization that the U.S. recession is not an isolated event. Euroland, Japan, Britain, Sweden, probably Canada and New Zealand, and possibly Australia will experience recessions, too. So will a number of developing economies in all major regions. […] More
New Overnight Developments Abroad - Daily Update
New Overnight Developments Abroad: Many Japanese and European Data Releases
November 28, 2008
Currency movements reflect a little less risk tolerance. The yen firmed 0.2% against the dollar, which otherwise posted gains of 0.5% against the euro and Swiss franc, 0.4% relative to the Canadian dollar, 0.3% against sterling, 0.2% against the kiwi and 0.1% against the Australian dollar. In Asia, the Nikkei advanced 1.7%. Stocks also rose […] More
New Overnight Developments Abroad - Daily Update
New Overnight Developments Abroad: Stocks Higher, Dollar Mostly Lower
November 27, 2008
Asian bourses were inspired by China’s big rate hike yesterday and rallied by 2.0% in Japan, 4.3% in Taiwan, 3.3% in South Korea, 1.8% in the Philippines, and 1.5% in China. Australian equities advanced 1.4%. In Europe, the Dax is up 2.2%, and the Ftse has gained 2.0%. The Paris Cac shows a 1.7% rise. […] More
Consumption: the Key U.S. Imbalance
November 26, 2008
It is imprudent to spend everything one earns. It’s a lesson taught young-aged children in the lyrics of I’ve Got Sixpence. Think of the two pence that gets lent as the portion being saved or invested. I’ve got sixpenceJolly. jolly sixpenceI’ve got sixpence to last me all my lifeI’ve got twopence to spendAnd twopence to […] More
Currency Markets in the News
A Global Attack on a Global Demand Deficiency
November 26, 2008
Acting in their own interests and based on local economic prospects, more central banks cut interest rates today. The biggest move was a 108-basis point reduction in China’s lending rate to 5.58%, matching the cumulative cuts of 27 bps each on September 15, October 8, and October 29th. The People’s Bank of China also slashed […] More
Currency Markets in the News
Inflation in Rapid Retreat Creates Leeway for Looser Monetary Policy
November 26, 2008
Price data released by Germany today exemplify a remarkable reversal of inflation trends and risks. Import prices dropped 3.6% in October on top of declines of 1.0% in September and 0.8% in August, and the 12-month rate of import price inflation plunged to 2.9% from 7.6% in September and 9.3% in October. Lower oil costs […] More
New Overnight Developments Abroad - Daily Update
New Overnight Developments Abroad: European Stocks, Bond Yields, and Euro Dropped
November 26, 2008
The dollar is unchanged against the Canadian dollar and yen but has climbed 0.9% against the Swiss franc, 0.8% versus sterling and 0.7% relative to the euro. Commodity currencies are narrowly mixed. The Paris Cac (-2.4%), German Dax (-1.5%) and British Ftse (-2.1%) show big losses on recessionary concerns. Equities are off 1.5% in Sweden […] More
Currency Markets in the News
Selected G-7 Economic Growth Forecasts
November 25, 2008
In the third quarter, real GDP contracted 0.5% in Germany not annualized and by 0.1% each on a similar basis in the United States and Japan. The composition of those negative growth rates was dissimilar and is expressed in percentage points (ppts) in the table below. A prior spike in commodity costs weighed on all […] More
New Overnight Developments Abroad - Daily Update
New Overnight Developments Abroad: Continuing Fallout from Citigroup Bailout
November 25, 2008
The dollar relapsed 1.2% against the yen. Against other currencies, the U.S. currency has trimmed Monday’s heavy losses with overnight gains of 2.2% against the Australian dollar, 1.7% against the New Zealand dollar, 0.8% against the Canadian dollar, 0.7% against the euro, and 0.6% versus sterling and the Swiss franc. The Nikkei jumped 5.2%. Stocks […] More
