Archive for October 2009

Foreign Exchange Insights and Next Week

Next Week

October 30, 2009

The U.S. turns its clocks back one hour to standard time this weekend.  Some markets but no major ones will be shut Monday for All Souls’ Day, and Japan is closed Tuesday for National Culture Day.  Central bank meetings will be held in the United States, Euroland, Britain, Indonesia, Hong Kong, The Philippines, Romania, Peru, […] More

Foreign Exchange Insights and Next Week

Weekly Foreign Exchange Insights: October 30th

October 30, 2009

At least four different forces are converging upon the currency markets, so last week’s mixed dollar performance was unsurprising and liable to continue. The most widely identified pattern is the risk trade wherein the dollar moves inversely with stocks in response to the waxing and waning of investors’ appetite for risk.  The dollar was well-bid […] More

Central Bank Watch

No Significant Surprises From Bank of Japan

October 30, 2009

The Bank of Japan promised to leave its uncollateralized interest rate at 0.1% “for some time” but took initial steps to rein in quantitative easing.  The decisions after four hours of deliberation were unanimous on the rate but included a dissent from Mizuno regarding the planned phase-out of unconventional steps to facilitate corporate financing. The […] More

New Overnight Developments Abroad - Daily Update

New Overnight Developments Abroad: Bank of Japan Projects Negative Inflation in Fiscal 2011

October 30, 2009

The dollar is mixed so far on this final trading day of October, with gains of 0.3% against the kiwi and 0.1% relative to sterling and the Canadian dollar but losses of 0.5% against the yen, 0.2% against the Swiss franc and 0.1% against the euro and Australian dollar. Stocks in the Pacific Rim are […] More

Central Bank Watch

Bank of Japan Preview

October 29, 2009

Japan’s central bank Policy Board has three orders of business to decide at Friday’s meeting. The uncollateralized overnight money rate target has been 0.1% since last December and is unlikely to get raised for a couple of more calendar quarters.  Although Japan is coming out of recession, the economic outlook is fraught with risks, and […] More

Currency Markets in the News

Economic Recovery in the U.S., Euroland, Japan, and Britain

October 29, 2009

The data from major advanced economies continues to inspire less hope than what China and other developing economies are reporting. Aspects of the 3.5% rise of U.S. GDP last quarter look too good to last.  Slightly over two-thirds of the increase resulted from consumption of durable goods (much of which reflects the expired cash for […] More

Central Bank Watch

Another Central Bank Rate Cut in Russia

October 29, 2009

The backdrop to today’s announced 50-basis point reduction in the Central Bank of Russia’s refinancing rate includes two cuts in September totaling 75 basis points, a cut of 25 bps in August and reductions of 50 basis points each in July, June, May and April.  The 9.5% new rate level, effective tomorrow, compares to 13.0% […] More

Central Bank Watch

New Zealand Cash Rate To Stay Low Through Mid-2010

October 29, 2009

The Reserve Bank of New Zealand implemented seven reductions of its cash rate between July 24, 2008 and April 30, 2009 from a year-long peak of 8.25% to a trough of 2.5%.  After the April 30th meeting, officials indicated that the benchmark rate was unlikely to move above 2.5% before the second half of 2010.  […] More

New Overnight Developments Abroad - Daily Update

New Overnight Developments Abroad: Dollar Down Slightly Despite Further Drop in Asian Stocks

October 29, 2009

The dollar has lost 0.7% against the Australian dollar, 0.6% versus sterling, 0.4% relative to the kiwi, 0.3% against the euro and Swissy, and 0.2% against the Canadian dollar.  Dollar/yen is unchanged. Stocks fell 2.5% in China, 2.4% in Taiwan, 1.8% in Japan, 3.1% in Vietnam, 1.7% in South Korea, 2.3% in Hong Kong and […] More

Larry's Blog

Oil To Boost On-Year CPI Comparisons Sharply

October 28, 2009

Even when inflation first fell below zero, central bankers around the world confidently predicted a return to the black in the final months of 2009.  The factor behind this prediction lies in the extremely sharp 59% decline of crude oil prices between the September 2008 and December 2008 monthly averages.  Economists call this kind of […] More

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