Central Bank Watch
Reserve Bank of New Zealand Closer to a Rate Hike
January 29, 2014
In 2013, New Zealand monetary authorities repeatedly reiterated the expectation that the official cash rate would stay unchanged at 2.5%, and they kept that implicit promise. Late in the year, the message was modified to inform people that increases would become necessary in 2014. The released statement from Governor Wheeler following this year’s first policy […] More
Central Bank Watch
FOMC Plows Forward with Measured Tapering
January 29, 2014
The decision to cut monthly purchases of mortgage-backed securities and longer-term Treasury Securities by $5 billion apiece matched analyst and investor expectations exactly and brings the cumulative combined lessening of quantitative stimulus to $20 billion per month from $85 billion to a new level of $65 billion. The $85 billion amount was introduced in September […] More
Central Bank Watch
FOMC Preview
January 29, 2014
Chairman Bernanke’s eight-year tumultuous stewardship is down to its final detail and appears likely to go out like a lamb, not a lion, without so much as the fanfare of press conference. There is a new array of voting regional presidents on the Federal Open Market Committee, including the hawkish Dallas Fed President Fisher and […] More
Central Bank Watch
South African Reserve Bank Repo Rate Hiked Unexpectedly and by 50 Basis Points
January 29, 2014
South Africa fits the profile of many battered emerging markets (EM): sub-potential and slowing growth, rising inflation exacerbated by capital outflows and the resulting currency depreciation, and sizable current account and fiscal deficits. Many EM central banks have been forced to raise interest rates under difficult circumstances. Monetary officials tightened by 50 basis points in […] More
Central Bank Watch
Reserve Bank of India Implements the Third Interest Rate Hike since September 20
January 29, 2014
Note to Readers: This blog entry was sent originally on January 28 but inexplicably got lost in cyberspace. Hopefully it will publish now. All three tightenings by the RBI including today’s and ones in September and October were by 25 basis points. The repo and reverse repo rate levels become 8.0% and 7.0%, respectively, while […] More
New Overnight Developments Abroad - Daily Update
Sharp Response from Turkey’s Central Bank Lifts Lira
January 29, 2014
After a late-night emergency monetary policy meeting in Turkey, the overnight borrowing and lending rates were raised by 450 and 425 basis points, respectively, to 8.0% and 12.0%, while the one-week repo rate increased by 550 bps to 10.0%. These changes far eclipsed even the boldest forecasts and initially at least boosted the Turkish lira […] More
