Archive for March 2019

Deeper Analysis

March and First Quarter 2019 in Figures

March 30, 2019

The table below documents changes in key market variables during March and the first quarter of 2019. Sharply reduced sovereign debt yields in both time intervals amidst slowing global growth and lessening inflation were a driving force behind other markets as well. Equities benefited but not nearly as much in March when the U.S. yield […] More

Foreign Exchange Insights and Next Week

Next Week

March 29, 2019

Central Banks: Monetary policy reviews in India, Australia, Poland and Romania. The Bank of Japan publishes the quarterly Tankan survey of corporate conditions and expectations. Bostic and Mester of the Federal Reserve speak publicly. So too will Bank of Canada Governor Poloz. Holidays and Special Notes: China and Hong Kong will be shut Friday for […] More

New Overnight Developments Abroad - Daily Update

Quarter-End Finds Focus on Brexit, Sino-U.S. Trade Talks and a Data Shower

March 29, 2019

Today was to have been Brexit Day, but it appears the Prime Minister May’s plan will be defeated in parliament for a third time. More confusion ahead. The United States and Chinese trade talks haven’t yet sealed a deal, but one seems to be getting a lot closer. Many pundits on such matters doubt it […] More

Deeper Analysis

Comment on Revised U.S. GDP

March 28, 2019

U.S. quarterly GDP growth in the final quarter of 2018 got revised downward by 0.4 percentage points to 2.2% annualized. Despite the positive spin from government officials, that’s below the average 2.7% per annum pace of the whole Trump presidency thus far. Moreover, personal consumption, which comprises about 70% of GDP, contributed disproportionately by accounting […] More

Central Bank Watch

Czech National Bank Policy Rate Unchanged

March 28, 2019

The Czech two-week repo rate was lifted from a low of 0.05% by 45 basis points in 2017 and 125 basis points last year to its current level of 1.75%. Two of seven rate policy deciders, who favored another 25 basis point hike now, were overruled by a majority to leave the key interest rate […] More

Central Bank Watch

South African Reserve Bank Repo Rate Left Unchanged as Expected at 6.75%

March 28, 2019

Despite a 6+% decline since the prior policy review in January, South Africa’s Monetary Policy Committee decided unanimously to keep the repo rate unchanged at 6.75% after its second scheduled review of 2019. The rate had been raised by 25 basis points at the final 2018 policy meeting four months ago but kept steady after […] More

New Overnight Developments Abroad - Daily Update

Weaker Turkish, South African and British Currencies

March 28, 2019

The Turkish lira slumped 5% against the dollar overnight when Turkish reserves data showed a large drop from previous intervention to support that currency. Still no word from the South African Reserve Bank’s monetary policy review, but analysts aren’t anticipating a rate hike. However, there is concern ahead of Moody’s sovereign debt call on South […] More

New Overnight Developments Abroad - Daily Update

Big Reaction in New Zealand Financial Markets to Downbeat Central Bank Statement

March 27, 2019

The kiwi dropped 1.4% overnight. New Zealand’s 10-year sovereign debt yield slumped 11 basis points, whole share prices in that market rose 1.6%. A statement released after a regular monetary policy review that left the Reserve Bank of New Zealand’s official cash rate unchanged at 1.75% paints a downbeat economic outlook not limited to the […] More

Deeper Analysis

One Problem with the Fed Letting Its Interest Rate Crest at 2.5%

March 26, 2019

Share prices are rallying today in part on hopes that the Federal Reserve has reacted quickly to a deterioration in the outlook for global and U.S. growth. By doing so, maybe the inversion of the U.S. yield curve that recently occurred will be the exception that doesn’t herald a U.S. recession within 18 months. I […] More

Central Bank Watch

Hungary Gets First Central Bank Interest Rate Hike in Since December 2011

March 26, 2019

The Monetary Council of Magyar Nemzeti Bank chose a time when many central banks including the Fed and ECB have turned more dovish to implement its first interest rate hike since a 50-basis point increase of the Base Rate way back in December 2011. That rate is now just 0.90% and was not changed at […] More

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