Currency Markets in the News
German 4Q Growth Deconstructed
February 25, 2009
Real growth last quarter tumbled 8.2% at an annualized rate (or -2.1% not annualized) and by 1.6% from a year earlier (or 1.7% after adjusted for a different number of working days). This was the third consecutive quarter of negative growth after annualized declines of 2.2% in 3Q08 and 2.0% in 2Q08. GDP growth in […] More
New Overnight Developments Abroad - Daily Update
New Overnight Developments Abroad: Surprising Calm
February 25, 2009
Markets are surprisingly calm. Today had the potential to be difficult after Bernanke’s testimony, Obama’s virtual State of the Union Address, and the release of more troublesome data in Asia and Europe. But the performances of Bernanke and Obama did more good than harm, and markets took a breather. Dollar movements have been mild: up […] More
Currency Markets in the News
G-7 Industrial Orders Bad All Over
February 24, 2009
In today’s overnight summary of economic news and market developments, I editorialized that the steep drop in Euroland industrial orders last quarter was as close as one generally gets to a free-falling trend. The intent of this post is not to rescind that comment but to extend it to the rest of the Group of […] More
Central Bank Watch
Bank Negara Malaysia Cuts Overnight Target Rate by Another 50 Basis Points
February 24, 2009
Malaysia’s central bank cut its target rate to 2.0% from 2.5% and halved reserve requirements to 1%. Two earlier rate reductions in the past three months amounted to 75 basis points on January 21st and 25 bps last November 24th. Officials spoke of rapidly deteriorating trade, production and investment on a global and regional scale […] More
New Overnight Developments Abroad - Daily Update
New Overnight Developments Abroad: Yen, Dollar, Stocks, Bond Yields All Lower
February 24, 2009
The yen lost another 1.1% against the dollar, hitting a 12-week low. The dollar in turn is weaker by 1.0% against the Swiss franc and Australian dollars, 0.9% against the euro, 0.8% against the kiwi, 0.4% against sterling and 0.1% against the Canadian dollar. Ukraine’s hrynvia slumped to a new record low after a ratings […] More
Central Bank Watch
Monetary Policy Held Steady in Hungary and Eased in Israel
February 23, 2009
Magyar Zembeti Bank, Hungary’s central bank, left its key interest rate at 9.5% as expected and released a statement that stressed the need to preserve financial market stability. The forint, like several Eastern European currencies, has been under selling pressure, a development that has also weighed on the euro. The Bank of Israel somewhat unexpectedly […] More
Bonds and Stocks
Monday Monday, Can't Trust That Day
February 23, 2009
The DOW fell 3.4% today and on the first calendar week session in ten of the last eleven weeks. The index is 0.5% away from exceeding a cumulative drop of 50% from the October record closing high of 14165. The market has lost 20.8% since Warren Buffett in mid-October pronounced that it was then a […] More
Canada In the Grip of a Triple Whammy
February 23, 2009
After an unexpected 1.3% annualized rise of real GDP in 3Q08, the Canadian economy fell into a severe recession and likely contracted by more than the Bank of Canada’s assumption of 2.3% in the fourth quarter of 2008. The central bank also penciled in negative growth rates of 4.8% this quarter and 1.0% in 2Q09. […] More
New Overnight Developments Abroad - Daily Update
New Overnight Developments Abroad: WSJ Story on Citi
February 23, 2009
The U.S. federal government will buy up to 40% of Citigroup shares according to the Wall Street Journal. The report lifted bond yields, stocks and oil prices. The dollar rose 1.6% against the yen, surpassing last week’s high against the Japanese currencies. The greenback also gained 0.8% against the Swiss franc but lost 1.1% versus […] More
Foreign Exchange Insights and Next Week
Weekly Foreign Exchange Insights: February 22nd
February 22, 2009
Intensifying risk aversion was apparent last week in loud chatter over the possibilities of emerging market debt defaults and nationalisation of many big banks. If vocalized fear wasn’t enough, sharp additional declines in share prices provided quantifiable proof that elevated risk aversion was indeed real and not just a lot of talk. In currency trading, […] More
