Archive for September 18th, 2012

Deeper Analysis

Financing the U.S. Current Account Deficit — Part II

September 18, 2012

A second table below focuses on the eight components of direct investment and portfolio investment.  Changes in each component between 1Q12 and 2Q12 are noted in the right-most column, where a positively signed change indicates an increased net inflow, a reduced net outflow, or a swing from a net outflow to a net inflow.  The […] More

Deeper Analysis

Financing the Second-Quarter U.S. Current Account Deficit – Part I

September 18, 2012

The current account deficit contracted 12% and to 3.0% of GDP from 3.5% of GDP in the first quarter.  Five-sixths of the deficit was covered by official capital inflows.  Direct and portfolio investment inflows, long-term capital inflows that represent the topmost quality of dollar support in fact generated a net outflow for a third straight […] More

Central Bank Watch

Bank of Japan Preview

September 18, 2012

The Bank of Japan Policy Board is meeting Tuesday and Wednesday of this week to decide whether more stimulus should be undertaken.  Market players and government officials will be beyond disappointment if no action is taken.  The central bank has scant scope to support its economy with interest rate tools.  The overnight money rate target […] More

Central Bank Watch

Monetary Policy Tweaked by the Central Bank of the Republic of Turkey

September 18, 2012

Monetary officials cut the overnight lending rate to 10.0% from 11.5%, while keeping the overnight borrowing rate unchanged at 5.0%.  A statement from officials declares that “narrowing the interest rate corridor would support financial stability,” then adding that “if deemed necessary, a measured step in the same direction may be taken in the forthcoming period.”  […] More

Central Bank Watch

Sri Lankan Monetary Policy Left Unchanged

September 18, 2012

The Monetary Board at the Central Bank of Sri Lanka left its repo and reverse repo rates at 7.75% and 9.75%, respectively. Rate hikes of 50 basis points last February and another 25 bps in April have indeed produced the desired result of cooling down the excessive growth of money and credit, and a statement […] More

New Overnight Developments Abroad - Daily Update

European Stocks and the Euro Suffer Setback

September 18, 2012

Share prices in Europe are having their worst session in two weeks.  Such have so far slumped by 2.3% in Italy, 1.8% in Spain, 1.3% in France, 1.1% in Germany, and 0.9% in Britain. The euro declined 0.4% against the dollar, which otherwise is unchanged against the Swiss franc, sterling, kiwi and yuan.  Another relative weak […] More

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