New Overnight Developments Abroad - Daily Update
Weaker Euro and Yen but Mixed Movements in Share Prices Overnight
July 28, 2015
China’s Shanghai Composite index dropped another 1.7%, and share prices elsewhere in the Pacific Rim lost 1.2% in Indonesia, 1.0% in Singapore, 0.4% in India and New Zealand, 0.3% in Taiwan and 0.1% in Japan. In Europe, however, stocks have recovered 1.8% in Italy, 1.5% in Germany, 1.4% in France and 0.7% in Switzerland. The […] More
Foreign Exchange Insights and Next Week
The Dollar, Fed Policy and Falling Equities and Commodities
July 27, 2015
One possible explanation for the stalled dollar advance was offered in last week’s Foreign Exchange Insights essay, namely contrasting current account positions in the United States on the one hand and the eurozone and Japan on the other. This week scopes out three other factors that may limit the U.S. currency’s strength. The first factor […] More
Central Bank Watch
Bank of Israel
July 27, 2015
The key central bank interest rate was left at 0.10%, its level since a cut of 15 basis points in February. There were three reductions of 25 basis points each in 2014, the latest of which occurred in August. 75 basis points each were cut in 2011, 2012, 2013 from an end-2010 level of 3.25%. […] More
New Overnight Developments Abroad - Daily Update
A Collapse in Chinese Equities
July 27, 2015
An 8.5% drop in the Chinese Shanghai Composite Index was the biggest daily decline since February 2007 and depressed investor sentiment in other markets, where stocks fell 4.0% in Hong Kong, 2.4% in Taiwan, 2.0% in India, 1.8% in Indonesia 1.2% in Singapore and 1.0% in Japan. In European trading, equities are down already by […] More
Foreign Exchange Insights and Next Week
Next Week
July 24, 2015
Central Banking Front: Five central banks hold monetary policy reviews: Brazil, Russia, Israel, Mexico, and the Federal Reserve. No press conference is scheduled after the FOMC statement, and markets do not anticipate a policy change. The monthly ECB Bulletin will be published, and Governor Stevens of the Reserve Bank of Australia speaks publicly. Scheduled U.S. […] More
New Overnight Developments Abroad - Daily Update
Thank God It’s Friday as Risk-Off Mood Persists
July 24, 2015
Share prices in the Pacific Rim fell 1.8% in China, 1.2% in Hong Kong, 0.9% in South Korea, India and Indonesia and 0.6% in Japan. Comex gold dropped another 0.8% to $1,082.00. West Texas Intermediate oil stayed below $50 but recovered 0.5% to $48.69 per barrel. Ten-year sovereign debt yields declined another five basis points […] More
Central Bank Watch
South African Reserve Bank Repo Rate Raised for First Time in a Year
July 23, 2015
A 25-basis point increase in SARB’s repo rate to 6.0% was the first change since two increases in 2014 of 50 basis points in January followed by 25 bps in July. South Africa is struggling with both low growth and rising inflationary pressure. Although total inflation is currently below target, a released statement projects a […] More
Central Bank Watch
Central Bank of the Republic of Turkey
July 23, 2015
Turkey’s Monetary Policy Committee again “decided to keep the interest rates at current levels.” Since being cut in February, the one-week repo rate has been at 7.5% and the overnight lending and borrowing rates have stood respectively at 10.75% and 7.25%. Previous peaks, reached after sharp hikes in January 2014 had been at 10.0%, 12.0% […] More
Central Bank Watch
Reserve Bank of New Zealand in Easing State of Mind
July 23, 2015
Monetary officials at the RBNZ are pushing for easier monetary conditions through a combination of lower interest rates and additional New Zealand dollar depreciation. A statement from Governor Wheeler after the second straight policy meeting to cut the Official Cash Rate (OCR) proclaimed that the economic outlook now looks somewhat softer than imagined at the […] More
New Overnight Developments Abroad - Daily Update
Weaker Dollar and Pound
July 23, 2015
The dollar edged 0.1% firmer against sterling but has lost 1.4% against the kiwi, 0.7% relative to the euro, 0.6% vis-a-vis the Swiss franc, 0.4% versus the loonie and Aussie dollar and 0.2% against the yen. The yuan is steady. Share prices rose 2.3% in China 0.6% in Hong Kong and 0.4% in Japan but […] More
