Central Bank Watch
People’s Bank of China Reduces One-Year Lending Rate by 40 Basis Points to 5.60%
November 21, 2014
In addition to the lending rate reduction announced today and effective tomorrow, monetary officials lowered the one-year deposit rate by 25 basis points to 2.75% and lifted the upper limit of the floating range of interest on the deposits of financial institutions from 1.1 times to 1.2 times. Chinese monetary policy easing came in from […] More
New Overnight Developments Abroad - Daily Update
Market-Moving Comments and Then a Chinese Interest Rate Cut
November 21, 2014
ECB President Draghi gave a dovish speech reaffirming the central bank’s readiness to take further action to lift inflation back to target. U.S. President Obama spoke to the nation in prime time, announcing plans to permit some 5 million undocumented residents not to be deported. San Francisco Federal Reserve President Williams warned about the danger […] More
Central Bank Watch
Central Bank of the Republic of Turkey
November 20, 2014
Turkey’s 8.25% one-week repo rate, 11.5% overnight lending rate, and 7.5% overnight borrowing rate were kept unchanged for a third straight monthly meeting. During meetings in May-July, they had respectively been lowered by 175 bps, 75 bps, and 50 bps, but officials are now resisting government pressure to ease, pledging instead to not do so […] More
Central Bank Watch
South African Repo Rate Left Unchanged at 5.75%
November 20, 2014
Officials at the South African Reserve Bank, who had raised their key interest rate by 50 basis points in January and 25 bps in July, continued to refrain from a third tightening. A released statement revised projected CPI inflation slightly lower (reflecting oil developments largely), predicted continuing weak growth next year, and observed persistent underlying […] More
New Overnight Developments Abroad - Daily Update
Scant Change in the Dollar on a Busy Data Release Day
November 20, 2014
The dollar has dipped 0.1% against the loonie, kiwi, and yuan and edged 0.1% higher versus the euro, Swissie and Australian dollar. Sterling is steady. The yen is down 0.2% on balance but touched new lows for the move overnight of 118.99 per dollar and 149.17 per euro. In the past two years since November […] More
Foreign Exchange Insights and Next Week
Who Dealt This Mess Anyway?
November 19, 2014
In this second decade of the 21st century, it is increasingly difficult to pull together a cogent market story. Part of the problem is the senseless path that world geopolitics seems to be taking. History documents crises that were more costly than present-day disturbances, but there is a global element to present day dangers that […] More
Central Bank Watch
Bank of Japan Review
November 19, 2014
The first meeting since a dramatic augmentation of quantitative stimulus, which took 5 hours and 24 minutes, reaffirmed those new policy parameters. The monetary base is being expanded via asset purchases by 80 trillion yen per year, versus 60-70 trillion prior to October 31. Annual JGB purchases will amount to 80 trillion yen, up from […] More
Central Bank Watch
Central Bank of Chile: Easing on Hold
November 19, 2014
Chilean officials are trying to strike a policy balance that maintains the credibility of the 2-4% inflation target but also supports growth, which is near 2% and at a five-year low. Monetary officials previously had implemented eight 25-basis point rate cuts in January 2012, October and November 2013, and February, March, July, August and September […] More
New Overnight Developments Abroad - Daily Update
Senate Vote Fall Short of 60 Needed to Approve Keystone XL Oil Pipeline
November 19, 2014
The dollar advanced overnight by 1.0% against the Australian dollar, 0.8% versus the kiwi, 0.7% relative to the yen, and 0.4% vis-a-vis the loonie. The dollar is unchanged against the yuan and down 0.2% relative to sterling and 0.1% against the euro and Swissie. Equities in the Pacific Rim rose 1.2% in Taiwan, 0.6% in […] More
Central Bank Watch
Bank Indonesia: Unscheduled Meeting Raises BI Interest Rate
November 18, 2014
At the regularly scheduled November policy meeting last Thursday, interest rates were left unchanged as expected. But after the new governments reduced fuel subsidy was announced, which will boost such prices by 31%, an emergency meeting of monetary policymakers decided to raise the key reference BI interest rate to 7.75% from 7.5%, its level since […] More
