Central Bank Watch

Bank of Norway Tightens

June 20, 2019

The last of today’s bonanza of central bank policy announcement was the exception to the dovish predisposition of other monetary authorities. The Bank of Norway as expected raised its policy interest rate by 25 basis points to 1.25%. This was the third tightening move following 25-bp increases last September and March but leaves the rate […] More

Bank of England Bracing for Possible No-Deal Brexit

June 20, 2019

The Bank of England left the British Bank Rate at 0.75%, its level since a 25-basis point hike last August. The baseline forecast, which was formally reviewed at the prior meeting, anticipates further rate normalization, but assumed a smooth Brexit process that looks increasingly unlikely. Today’s statement identifies increased downside growth risks, projects flat GDP […] More

Japanese Monetary Policy Not Changed

June 20, 2019

Following its scheduled monetary policy review, the Bank of Japan left its stance unchanged but observed weak industrial production, export demand, housing, and expected inflation. Amid escalating global uncertainties and ahead of a planned domestic sales tax hike, BOJ officials flagged a rising possibility of more easing in the future, but the credibility of that […] More

FOMC Statement and Projections

June 19, 2019

Today’s FOMC Statement downgraded the pace of economic activity to moderate but left the labor market assessment at strong. Personal consumption “appears to have picked up,” but business investment is still “soft.” As expected, forward guidance was modified, acknowledging increased uncertainties and replacing a stress on being patient with a promise to “act as appropriate […] More

FOMC Preview

June 19, 2019

After meeting last time seven weeks ago, the Federal Open Market Committee upgraded its assessment of economic growth, called the U.S. labor market strong, maintained the federal funds target range at 2.25-2.50%, and also kept the buzzword “patient” in describing its predisposition toward future adjustments of the policy stance. In rhetoric from Chairman Powell and […] More

Russian Monetary Stance Eased as Expected

June 14, 2019

The Central Bank of Russia today cut its benchmark interest rate for the first time since March 2018. The 25-basis point rate reduction to 7.5% had been foreshadowed in comments made after the previous monetary policy review, and today’s released statement points to more rate relief in coming months if inflation continues to settle back […] More

Swiss Quarterly Monetary Policy Review

June 14, 2019

The Swiss National Bank’s quarterly monetary policy review yesterday left the expansionary stance unchanged. Viewing their currency to be overly pricey, officials remain prepared to intervene against excessive appreciation on a discretionary basis as appropriate. The 3-month sight deposit target remains negative 0.75% as defined by a -1.75 to -0.25% 3-month LIBOR corridor. However, officials […] More

Central Bank of Turkey Keeps Existing Tight Stance

June 12, 2019

Turkish inflation has eased to a 9-month low of 18.7%, down from 19.1% in April and a peak of 25.2% last October. The economy is rotating away from overheated domestic demand and toward externally-driven growth, but these desired developments have not progressed far enough to persuade officials to take their foot off the monetary brakes […] More

50 Basis Point Central Bank Rate Cut in Chile

June 11, 2019

The Central Bank of Chile last Friday unexpectedly cut its benchmark interest rate by 50 basis points to 2.50%, the lowest level sinceĀ  a 25-basis point hike in January. The policy reversal returns the key interest rate to the low prevailing from May 2017 until October 2018. According to a officials, one should not infer […] More

Sri Lankan Interest Rates Cut

May 31, 2019

The Central Bank of Sri Lanka cut its interest rates by a half percentage point, citing the Easter terrorist attacks there, easier monetary policies elsewhere, downward rigidity in Sri Lankan market rates, slowing private sector credit expansion, a narrowed trade deficit, and subpar domestic growth. A recent uptick of inflation was dismissed as not being […] More

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