Foreign Exchange Insights and Next Week
Next Week
February 15, 2013
The meeting of G20 finance ministers and central bank leaders concludes tomorrow. China reopens for business after the week-long Lunar New Year celebration, but next week opens with Monday holiday closures in the United States for President’s Day and Canada for Family Day. On the central banking beat, Turkey and Thailand hold interest rate meetings […] More
Central Bank Watch
Central Bank of Chile Leaves Overnight Interest Rate at 5.0%
February 15, 2013
The interest rate benchmark has been steady since a 25-basis point cut in January 2012, which was the one and only reduction so far. No second reduction is in sight, since Chilean economic growth exceeds 5% and is surpassed in Latin America by only Peru. Nor is a rate hike in the immediate offing, since […] More
New Overnight Developments Abroad - Daily Update
Russian Happenings
February 15, 2013
A large meteorite fell to earth in Chebarkul near the Ural Mountains, injuring about 300 people. G20 central bank leaders and finance ministers meanwhile began the first session of a two-day meeting in Moscow. Foreign exchange traders eagerly await the formal text that emerges. A Russian deputy finance minister said the statement will not single […] More
Foreign Exchange Insights and Next Week
A Crowded Currency Market Radar Screen
February 14, 2013
The foreign exchange game is not just about currency war, both real and imagined. Those with exposures also need to keep an eye on economic growth after awfully weak fourth-quarter figures and trends in long-term sovereign debt yields and equities. Important events are fast approaching like the Italian election on February 24, U.S. federal government […] More
Central Bank Watch
Bank of Korea: Split Vote for No Policy Change this Time
February 14, 2013
The seven-day repo rate was left at 2.75% for a fourth consecutive time as expected, but the decision not to ease was not take unanimously. The interest rate benchmark was earlier cut last July and October — each time by 25 basis points — and those cuts came after a series of four rate increases […] More
Central Bank Watch
Bank of Japan: No Additional Policy Initiatives this Month
February 14, 2013
The February meeting of the Bank of Japan Board never figured to be significant. The five-year terms of Governor Shirakawa and Deputy Governors Nishimura and Yamaguchi expire the middle of next month, and they had indicated previously that BOJ policy had been eased as much as they were comfortable doing. A by-product of accelerated quantitative […] More
New Overnight Developments Abroad - Daily Update
Weaker-than-Projected Ezone GDP Depresses Euro and European Equities
February 14, 2013
The dollar has risen 0.9% against the euro and 0.6% versus the Swiss franc. The U.S. currency otherwise is up 0.2% relative to sterling and 0.1% against the loonie and Aussie dollar but down 0.3% against the yen and 0.5% versus the kiwi. The yuan is steady, showing no reaction to confirmation remarks by Jacob […] More
Central Bank Watch
Swedish Riksbank Signals Likely Unchanged Repo Rate until 1Q14
February 13, 2013
The six-person Executive Board of Sweden’s central bank left its 1.0% repo rate unchanged and released a statement with the following future rate guidance: The low interest rate supports economic activity so that inflation will rise towards the target of 2 per cent. The repo rate is expected to remain at this low level for […] More
New Overnight Developments Abroad - Daily Update
Higher Bund and Gilt Yields
February 13, 2013
The yields on 10-year sovereign German and British debt jumped by six and ten basis points overnight. The 10-year Japanese JGB yield slipped a basis point, but futures point to a higher yield in U.S. Treasuries. The yen strengthened to 92.81 per dollar overnight but is presently 0.2% softer on balance at 93.64. The U.S. […] More
Central Bank Watch
No Central Bank Rate Change in Sri Lanka
February 12, 2013
Sri Lankan central bank authorities have retained a 7.5% repo rate (and 9.5% reverse repo), just as they decided in January. The rates were cut by 25 basis points in December once progress had been observed in cutting non-oil import growth and domestic credit expansion. Those were the goals sought when central bank rates were […] More
