Archive for July 2013

New Overnight Developments Abroad - Daily Update

Monday

July 29, 2013

In a week crammed with meaningful data releases and press conferences at the FOMC and ECB, Monday was uneventful in both respects. The dollar advanced 0.6% and 0.5% against the Australian and New Zealand dollars.  Otherwise, the U.S. currency rose 0.3% against sterling but fell 0.3% versus the yen, rose 0.1% against the euro but […] More

Foreign Exchange Insights and Next Week

Next Week

July 26, 2013

Central bank policy meetings are scheduled in the United States, Euroland, U.K., Czech Republic, Israel, and India.  The U.S. and ECB meetings will be followed by press conferences. Swiss markets will be closed Thursday for a National holiday. Manufacturing purchasing manager surveys will be published for many economies, including the United States, Euroland, Britain, Germany, […] More

New Overnight Developments Abroad - Daily Update

Stronger Yen

July 26, 2013

The yen is 0.7% stronger against the dollar and hit an overnight high of 98.26/USD following the release of Japanese CPI figures.  Both total (up 0.2% from June 2012) and core CPI inflation (+0.4%) were positive.  Deflation seems to be disappearing faster than anyone imagined. Tokyo consumer prices in July were 0.2% higher than in […] More

Foreign Exchange Insights and Next Week

No Moral Bias to the Buoyant Euro

July 25, 2013

Currency markets are not altruistic.  The recent buoyancy of the euro above both $1.3000 and JPY 130 is the latest example that the invisible hand of the market popularized by Adam Smith does not hand out gratuitous favors to those economies in greatest need.  Forward-looking signs are mounting that the nearly two years of recession […] More

Central Bank Watch

Reserve Bank of New Zealand

July 25, 2013

New Zealand’s Official Cash Rate, which has been at 2.5% since right after the South Island earthquake some 2-1/4 years ago, will likely stay at that level for the balance of 2013 according to the latest statement on monetary policy.  In such, Governor Wheeler expresses confidence about the economy: Growth in the New Zealand economy […] More

Central Bank Watch

No Changes in Filipino Central Bank Rates

July 25, 2013

The Monetary Board of Bangko Sentral ng Pilipinas released a statement after this year’s fifth scheduled interest rate policy meeting that concludes, “that prevailing monetary policy settings remain appropriate. The manageable inflation outlook and strong domestic growth support keeping policy settings steady given renewed market volatility.” The overnight lending repo rate and overnight borrowing reverse […] More

New Overnight Developments Abroad - Daily Update

Decent Data but Equities Fall Anyway

July 25, 2013

British GDP experienced the best quarter in nine, rising twice as fast in the second quarter (0.6%) as in 1Q and to 1.4% above the level in 2Q12.  Britain’s services index in March-May was 0.8% higher than in December-February. The German industrial business climate index of the IFO Institute improved another 0.3 points to 106.2, […] More

New Overnight Developments Abroad - Daily Update

Data Surprises – Both Good and Bad

July 24, 2013

Euroland preliminary PMI results were better than hoped. The composite Ezone PMI of 50.4 broke above the 50 no change threshold to an 18-month high.  Manufacturing at 50.1 was at a 24-month peak, while services at 49.6 was at an 18-month high and reinforced a picture that the recession seems to be bottoming. Germany’s 52.8 […] More

Central Bank Watch

Twelfth Straight Interest Rate Cut in Hungary

July 23, 2013

Magyar Nemzeti Bank’s two-week repo rate was sliced to 4.0%.  This was the 12th monthly reduction in a row, a streak that started last August with a cut to 6.75% from 7.0%.  The severity of Hungary’s recession seems to have lessened, and inflation of 1.9% last month remained below the 3.0% target.  The dollar hasn’t […] More

Central Bank Watch

Central Bank of the Republic of Turkey

July 23, 2013

Turkish inflation had spiked more than a percentage point to 8.3% in June, fed partly by food and energy pressures, and Turkish monetary officials responded with a 75-basis point increase of the overnight lending rate to 7.25%.  The overnight borrowing rate was left at 3.5%.  Both rates had been cut earlier this year, including 50-bp […] More

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