Central Bank Watch
Eighth Straight Month to See a Central Bank Rate Cut in Hungary
March 26, 2013
Under newly appointed Governor Matolcesy, who has surrounded himself with like-minded monetary doves, the monetary council of Magyar Nemzeti Bank implemented another 25-basis point cut of its two-week deposit rate. The new level of 5.0%, down from 7.0% prior to last August, is a record low, eclipsing the 5.25% level in April 2010. The custom […] More
New Overnight Developments Abroad - Daily Update
U.S. to Release Several Indicators Today
March 26, 2013
Misgivings persist over the Cyprus bailout, which continues to be handled clumsily. Banks in that country remain closed today and tomorrow. European finance ministers first suggested the deal might be a trendsetter for other banking systems in trouble but then reverted to calling Cyprus a special case. Attention now shifts to the United States. In […] More
Central Bank Watch
Bank of Israel: No Rate Change
March 25, 2013
The Bank of Israel statement following the March interest rate meeting, which was tucked in just prior to the Pesach holiday, unvealed a third consecutive decision to leave the benchmark interest rate at 1.75%. Six cuts of 25 basis points apiece were implemented between September 2011 and December 2012. Israeli growth slowed in 2012 and […] More
New Overnight Developments Abroad - Daily Update
Deal Reached on Cyprus… Quiet Day from Data Standpoint
March 25, 2013
An agreement was forged between the creditor troika (ECB, EU, and IMF) and Cyprus that isolates Bank Laiku’s bad assets, permits bailout money to flow, and penalizes large shareholders and bondholders but not other depositors. In the end, other EU governments flinched to avert a crisis. Stocks are up 1.8% in France, 1.5% in Germany, […] More
Central Bank Watch
A Larger Interest Rate Cut by the Central Bank of the Republic of Colombia
March 22, 2013
Monetary policymakers in Bogota eased policy for the fifth straight month and for the seventh time since their meeting last July. While the first six rate cuts were by 25 basis points, the increment was doubled to 50 bps today. The accrued reduction of 200 bps over this span offsets all by 25 bps of […] More
Foreign Exchange Insights and Next Week
Next Week
March 22, 2013
Next week is the last one of March and the first calendar quarter, as well as the end of Japan’s fiscal year. The week will be a shortened one because of the Good Friday holiday. Among markets observing the holiday are Germany, Switzerland, Britain, France, Spain, Italy, Sweden, Australia, New Zealand, Canada, the United States, […] More
New Overnight Developments Abroad - Daily Update
Still No Resolution in Cyprus
March 22, 2013
The Cypriot government has until Monday to raise EUR 5.8 billion, or the country will not receive bailout money from the ECB troika. A rumor that Laiku Bank might close sent depositors scrambling to ATMs. Not much data were released overnight. The IFO business climate index for Germany was the main item, and it was […] More
Foreign Exchange Insights and Next Week
Currency Paradox
March 21, 2013
The dollar and euro are natural rivals. The dollar and euro are the two most influential currencies in the world, a fact reflected in their one and two standings in reserve asset portfolios. In the arena of foreign exchange, one currency’s rise in a bilateral relationship is tautologically the other’s decline. Worsening general sentiment […] More
New Overnight Developments Abroad - Daily Update
Disappointing Economic Data from the Euro Area and Japan
March 21, 2013
Risk appetite is down. The Cypriot banking crisis continues to fester. Preliminary Ezone PMI readings for March were troubling. Japan posted a record customs clearance trade deficit, and its all-industry index fell more than 1% in January. British retail sales and New Zealand GDP released figures were bright spots, however. Equities in Europe have dropped […] More
Central Bank Watch
Today’s FOMC Statement
March 20, 2013
Today’s statement from the Federal Open Market Committee repeated the January 30th statement in most respects, including The retention of all existing interest rate and quantitative monetary policy settings. The retention of the same economic data-driven policy guidelines for the future of the federal funds target. These are thresholds, not targets that would automatically necessitate […] More
