Foreign Exchange Insights and Next Week
Next Week
March 31, 2012
The week to April 6 begins with the EU summit in Copenhagen, which is intended to solidify the size and other properties of the funds to be used to aid troubled euro area debtor nations, and it ends with the Good Friday holiday closure in Germany, Switzerland, New Zealand, Australian, Canada, the United States and […] More
Deeper Analysis
March and 1Q12 in Figures
March 31, 2012
The dollar posted strong gains in March against the Australian dollar and yen but was narrowly mixed otherwise. Sovereign bond yields rose, led by a 24-bp in the 10-year Treasury. Three-month euribor rates sank sharply. Most equities performed well, while strong January-February gains in gold and oil prices were reversed partly. 10-Yr Yield 03/30/12 Chg […] More
Foreign Exchange Insights and Next Week
Currency World at First Quarter-end 2012
March 30, 2012
From a government perspective, chronic currency appreciation is undesirable. In the quarter now ending, officials in Japan, China, and Switzerland did their utmost to keep a lid on the yen, yuan, and franc. A drop in the yen of more than 6% against the dollar helped lift Japan’s Nikkei-225 by 19.3% in the quarter, some […] More
New Overnight Developments Abroad - Daily Update
Big EU Meeting as First Quarter Ends
March 30, 2012
The dollar is softer at the New York opening on this final day of the calendar quarter with drops of 0.5% against the kiwi, 0.4% versus the yen and Swissie, 0.3% relative to the euro and sterling, 0.2% against the yuan and 0.1% against the Australian dollar. Stocks performed better than earlier this week. Equities […] More
Deeper Analysis
Canadian Budget Highlights
March 29, 2012
The annual 2012 Canadian budget, presented late Thursday conceivably might restore a balanced budget by the fiscal year that starts in April 2014, a mere two years from now. The deficit in fiscal 2010-11 equaled C$ 33.4 billion, by comparison. Today’s budget projects a deficit of C$ 1.3 billion in fiscal 2014-15 but embodies a […] More
Central Bank Watch
South African Reserve Bank Keeps Status Quo Despite Cost Push Pressure
March 29, 2012
South Africa’s key repurchasing rate of 5.5% was last changed on November 18, 2010. A 50-bp cut then culminated a nine-step 650-basis point easing cycle that was begun in December 2008. A statement from central bank officials concedes that cost-push pressures, mainly from wages, persist but errs on the side of supporting economic growth. Latitude […] More
Central Bank Watch
Czech Monetary Policy Stance Stays on Hold
March 29, 2012
In its second policy meeting of 2012, the Czech National Bank Board voted to leave the key two-week repo rate at 0.75%, its level since a 25-basis point cut on May 6, 2010 that culminated a 7-move, 300-basis point easing. Czech GDP contracted 0.5% annualized in the final quarter of 2011 and was merely 0.3% […] More
Central Bank Watch
Another Romanian Interest Rate Cut
March 29, 2012
Romania’s monetary policy rate has been reduced to 5.25% from 5.5%. This move by the National Bank of Romania was not a big surprise and follows similar 25-bp cuts announced November 2, January 5, and February 2. CPI inflation subsided to 2.6% in February from 3.1% in December and 8.0% at end-2010. Weak growth in […] More
New Overnight Developments Abroad - Daily Update
Share Prices Sinking on a Thursday Crammed with New Information
March 29, 2012
Equities fell 1.3% in China and Hong Kong, 1.5% in Vietnam, 2.1% in Taiwan, 0.9% in South Korea, 0.7% in Japan and 0.4% in India. The German Dax, Paris Cac and British Ftse have already lost 1.1%, 1.0%, and 0.9% today. Continuing the motif of greater risk aversion, the yen has advanced 0.8% against a […] More
Deeper Analysis
Unemployment: Structural or Cyclical
March 28, 2012
A big policy debate about the U.S. economy concerns its vulnerability to accelerating inflation. This argument hinges critically over whether 8.3% unemployment reflects a structural deficiency of skill supplies versus skilled worker demand or insufficient overall demand. Officials at the Federal Reserve lie on both sides of the fence. Notably, Chairman Bernanke, who exerts the […] More
