New Overnight Developments Abroad - Daily Update
Share Prices and Sovereign Debt Yields Rebound… Brexit Situation Remains Muddled
March 26, 2019
In futures trading, the 10-year treasury yield rose five basis points to 2.44%. The 10-year German bund and Japanese JGB yield firmed two bps, while their British counterpart is 3 basis points firmer. Share prices rebounded 2.2% in Japan, 1.1% in India, 0.9% in Indonesia, 0.8% in Taiwanand 0.6% in Singapore. European equity markets are […] More
Foreign Exchange Insights and Next Week
Less Dollar Volatility in First Quarter Than Meets the Eye
March 25, 2019
Long-time readers of Currency Thoughts have no doubt observed a diminished frequency of “insight” posts on the dollar in this space. A reason for this is that currency markets in recent years have been dominated by unexpected and abnormal political and policy developments to an even greater extent than usual. Surprise shocks are the bane […] More
New Overnight Developments Abroad - Daily Update
Several Reassuring Developments
March 25, 2019
Last Friday had been a brutally difficult day in financial markets after the U.S. 3-month T-bill rate moved above the 10-year Treasury note yield for the first time since the Great Recession. Monday has seen reassuring news on several fronts but not before share prices in the Pacific Rim tumbled 3.0% in Japan, 2.3% in […] More
Foreign Exchange Insights and Next Week
Next Week
March 22, 2019
Central Banks: Policy meetings in Mexico, New Zealand, South Africa, Chile, Hungary and the Czech Republic. Many Fed officials have public speaking engagements including Harker, Rosengren, Clarida, Williams, Quarles, Evans, George and Bullard. ECB President Draghi, Vice President DeGuindos, and Executive Board members Praet and Mersch also will be speaking. So will Ellis and Kent […] More
Central Bank Watch
Russian Central Bank Indicates Interest Rate May Be Cut Later this Year
March 22, 2019
The Central Bank of the Russian Federation maintained a one-week repo rate of 7.75% after its latest monetary policy review. The key interest rate was increased a quarter of a percentage point twice last year in September and then in December, but a statement released today revised projected inflation this year downward by 0.3 percentage […] More
New Overnight Developments Abroad - Daily Update
A Fresh Wave of Risk Aversion
March 22, 2019
There’s been a big move into safe assets, reflecting three developments since Wednesday: The Fed’s decision was more dovish than expected, putting interest rate normalization on hold for all of 2019 and ending the balance sheet rundown after September. EU leaders put Britain on a short leash to decide on its Brexit plan. While March […] More
Central Bank Watch
Bank of England’s Policy Settings Unchanged
March 21, 2019
The Bank of England as expected did not change its 0.75% Bank Rate, which earlier had been raised twice by 25 basis points, initially in November 2017 and then in August 2018 to 0.75%, highest since March 2009. Nor were quantitative policy tools modified, and both decisions were made unanimously as expected. In a released […] More
Central Bank Watch
Swiss National Bank Keeps Policy the Same but Lowers Projected CPI Inflation Path
March 21, 2019
At the latest quarterly review of Swiss monetary policy, SNB officials kept policy unchanged. Since January 2015, when the automatic cap on Swiss franc was lifted and the interest rate target was cut by 50 basis points, the 3-month Libor rate target band has been an all-negative range of minus 1.25% to minus 0.25%, the […] More
Central Bank Watch
Bank of Norway Tightens
March 21, 2019
The Bank of Norway’s policy interest rate was lifted 25 basis points to 1.0%. Norway is an oil producer and exporter and benefits from the firmer trend lately in that commodity. Growth has been solid, according to a released statement. Capacity usage is running a bit above normal, and core CPI inflation is somewhat higher […] More
New Overnight Developments Abroad - Daily Update
Theme of the Day: Slowing Global Growth
March 21, 2019
Since the Federal Reserve’s policy decision and press conference yesterday, there’s been a parade of other central bank policy meetings. Although only Norway changed its policy rate — a hike no less — the running theme in the many central bank statements is that the slowdown in global demand late last year is continuing and […] More
