Archive for June 2017

Larry's Blog

Is It Time to Push Back Against Coming Inflation?

June 30, 2017

Fixed income sovereign debt yields have been rising. The Federal Reserve has already raised the federal funds rate four times and is promising more increases as well as separate actions to begin trimming its $4.5 trillion balance sheet. ECB President drew attention after observing that forces of reflation are displacing forces of deflation, and a […] More

Foreign Exchange Insights and Next Week

Next Week

June 30, 2017

Central Banks: Monetary policy meetings in Australia, Thailand, Ukraine, Poland and Romania. FOMC minutes, ECB Account (like minutes), and the Bank of Japan quarterly Tankan survey of businesses will be published. Powell and Bullard are two of the Federal Reserve officials who’ll speak publicly. Holidays: Canada Day to be observed Monday. U.S. Treasury market closes […] More

New Overnight Developments Abroad - Daily Update

Big Day for Data, Dollar and Stocks Mixed

June 30, 2017

It’s the end of the month, end of the quarter, middle of the year and the eve of a long U.S. holiday weekend. That means a flood of data are getting released. For many organizations, its the end of a fiscal year. Stocks fell in the Pacific Rim but are recovering in Europe. Share prices […] More

Central Bank Watch

Czech National Bank Policy Unchanged at Latest Meeting

June 29, 2017

The central bank’s key two-week repo rate has been at 0.05% since November 2012, but an asymmetric foreign exchange policy that prevented the koruna from strengthening beyond 27 per euro in the period from November 2013 was ended this past April 6. A statement after the latest CNB policy review is upbeat about growth prospects […] More

Deeper Analysis

Comment on Revised U.S. GDP Figures

June 29, 2017

According to revised figures, real GDP expanded 1.4% at an annualized rate between the last quarter of 2016 and the first quarter of 2017. The initial estimate of 0.7% was revised a month ago to 1.2%. Personal consumption (up 1.1% annualized), non-residential business investment (10.4%) and residential construction (13.0%) collectively augmented real GDP growth by […] More

New Overnight Developments Abroad - Daily Update

Dollar and Fixed Income Security Prices Soften

June 29, 2017

The dollar declined overnight by 0.5% against the peso, 0.4% relative to the Australian currency, 0.3% versus the yuan and sterling, 0.2% vis-a-vis the euro, and 0.1% against the Swiss franc and loonie. The dollar firmed 0.2% against the kiwi and 0.3% versus the yen. Ten-year German bund and British gilt yields jumped five basis […] More

Foreign Exchange Insights and Next Week

Populism Not a Good Recipe for Currency Strength

June 28, 2017

Among highly developed countries, the United States and Great Britain are some of the best examples in which the politics of populism has made the greatest inroads. Sterling is roughly 14% weaker now against the dollar than when the Brexit referendum was approved a little over a year ago, but even the pound has appreciated […] More

New Overnight Developments Abroad - Daily Update

Some Confusion Understanding Central Banker Intentions

June 28, 2017

ECB President Draghi said several things yesterday. A remark that the pendulum of price pressure is shifting away from deflation toward reflation had caught the market’s immediate attention and driven the euro higher, but the ECB today clarified that investors had not given sufficient weight to his other observation that plenty of monetary stimulus is […] More

Central Bank Watch

Central Bank of Sri Lanka

June 27, 2017

Following last week’s policy review, Sri Lanka’s key central bank deposit and lending rates were again maintained at 7.25% and 8.75%, the levels since a pair of 50-basis point increases implemented last year in February and July. A statement of explanation called the monetary policy stance “appropriate” and predicted that total and core CPI, which […] More

New Overnight Developments Abroad - Daily Update

Stocks and Dollar Mostly Retreat in Choppy Markets

June 27, 2017

The dollar declined overnight by 0.8% against the euro, 0.7% relative to the Swiss franc, 0.4% versus the yuan, 0.3% relative to the Australian dollar and sterling and 0.2% vis-a-vis the kiwi and loonie. The dollar is unchanged against the Japanese yen and 0.3% firmer relative to the Mexican peso. Today’s main event will be […] More

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