Archive for February 4th, 2009

Bank of England Likely to Cut Key Rate 50 Basis Points to 1.0%

February 4, 2009

Bank of England officials considered adopting a wait-and-see stance in January and unanimously rejected that option in the face of extraordinarily weak economic activity and the possibility that doing nothing would hurt what little investor confidence remained about the future.  So the rate was cut by 50 basis points to 1.5%, the lowest level ever […] More

Currency Markets in the News

ECB Preview

February 4, 2009

I do not expect ECB policymakers to reduce its 2.0% refinancing rate, and neither does the market consensus.  The decision will be revealed Thursday at 12:45 GMT.  Based on remarks by President Trichet a month ago, it would have taken much weaker trends than expected to compel the Governing Council to ease in February.  Weak […] More

Central Bank Watch

National Bank of Romania Cuts Interest Rates First Time Since June 2007

February 4, 2009

Romania’s central bank reduced its monetary policy rate by 25 basis points to 10.0%. A peak of 10.25% had been in place since the beginning of last August.  What a difference a year makes: increasingly worried about inflation, the central bank had lifted the key rate by 100 basis points exactly one year ago today.   […] More

Currency Markets in the News

January PMI's Show Greater U.S. Than Ezone Improvement

February 4, 2009

  U.S. Ezone   U.S. Ezone   Sum of   Services Services Spread Mf’g Mf’g Spread Spreads Feb 2008 49.7 52.3 -2.6 48.8 52.3 -3.5 -6.1 March 49.9 51.6 -1.7 49.0 52.0 -3.0 -4.7 April 51.9 52.0 -0.1 48.6 50.7 -2.1 -2.2 May 51.2 50.6 +0.6 49.3 50.6 -1.3 -0.7 June 48.8 49.1 -0.3 49.5 […] More

Central Bank Watch

Norwegian Policy Rate Cut to 2.5% from 3.0%

February 4, 2009

A 50-basis point rate reduction by the Norges Bank today matched consensus market expectations.  This was the fourth cut since mid-October, totaling 325 basis points from a prior peak of 5.75%.  A statement released by the central bank suggests that policy has entered a wait-and-see period during which the impact of policy stimulus will be […] More

Central Bank Watch

Indonesian BI Rate Reduced to 8.25% from 8.75%

February 4, 2009

Indonesia’s central bank cut its benchmark rate today by 50 basis points following reductions of 50 bps in January and 25 bps in December. The last of several previous tightenings was implemented on October 7, a rise of 25 bps to a peak of 9.25%. A preliminary explanation of today’s move was released immediately in […] More

New Overnight Developments Abroad - Daily Update

New Overnight Developments Abroad: Dollar and Yen Higher

February 4, 2009

Risk aversion reasserted itself on the possibility that the U.S. Senate may reject (delay?) passage of the big fiscal stimulus. The yen is 0.4% higher against the dollar, which in turn recovered 2.1% against the Australian dollar, 1.6% versus the kiwi, 1.5% against the Swissy and 1.3% relative to the euro. The dollar also rose […] More

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