Central Bank Watch

Mexico’s Fifth Central Bank Rate Cut Since Last August

February 13, 2020

The Governing Board of the Mexico has just reduced its overnight interbank interest rate to a 3-year low of 7.0% from 7.25%. Four prior cuts in 2019 were made in August, September, November and December — each by 25 basis points as well. That reverses half of 250 basis points of tightening in 2017-2018. A […] More

Central Bank of the Russian Federation

February 7, 2020

The Central Bank of Russia’s one-week repo rate was reduced further today. The cut was 25 basis points to 6.0%, matching similar moves in December, September, July, and June. Last October, such was cut by 50 basis points. A released statement flags the possibility of more easing ahead insofar as inflation has dropped more sharply […] More

Czech National Bank

February 6, 2020

The Czech rate decision, a hike of the 2-week Czech National Bank repo rate to 2.25% from 2.0%, was a surprise and reflects a razor-thin 4-3 voting margin by the Monetary Board. Due in part to higher indirect taxes, CPI inflation has risen to 3.2%, highest since late 2012, and officials don’t expect such to […] More

Rate Cut in the Philippines

February 6, 2020

Also as had been anticipated by analysts, the Filipino reverse repo rate was cut 25 basis points to 3.75%. Such is the fourth such reduction since last May and the first change since September. Inflation has risen to 2.9%, but that is still just in the middle of the central bank’s target of 2-4%. “the […] More

Reserve Bank of India Eases

February 6, 2020

As expected, the Reserve Bank of India left policy settings unchanged, including a 5.15% repo rate, which previously had been cut by a total of 135 basis points between February and October of last year. A statement from the Monetary Policy Committee revised near-term inflation up due to higher onion prices, predicts that GDP will […] More

A Fifth Bank of Brazil Rate Cut Since July

February 5, 2020

Brazil’s Selic Rate has been reduced to 4.25% from 4.5%, but a released statement calls for a pause in the easing that totals 225 basis points since mid-2019. The Copom judges that the current stage of the business cycle recommends caution in the conduct of monetary policy. In light of the lagged effects of the […] More

Rate Cuts at the Central Bank of Iceland and The Bank of Thailand

February 5, 2020

The Central Bank of Iceland as expected cut its 7-day term deposit rate by 25 basis points to 2.75%. A total of six 25-bp cuts were enacted during 2019. In a released statement, members of the Monetary Policy Committee cut their projected 2020 growth rate in half  to 0.8%, observing weak exports and tighter financial […] More

Central Bank Rate Cuts in Ukraine and Sri Lanka

January 30, 2020

The National Bank of Ukraine statement stresses a strengthening currency and inflation that has dropped sharply and is now expected to hover below the 4-6% target band until late this year. The rate was cut 150 basis points to 11.0% today and previously had been reduced by 50 bps each in April, July and September […] More

Bank of England Makes No Policy Change

January 30, 2020

The Bank of England’s policy rate has been 0.75% since a pair of 25-basis point hikes in November 2017 and August 2018. There were no changes made in 2019 or at this week’s first meeting of the Monetary Policy Committee this week. There were dissenting votes, however, but Saunders and Haskel, who have favored a […] More

FOMC Statement and Powell News Conference

January 29, 2020

Three take-away points are to be noted about today’s FOMC statement: It was comparatively brief, using 46% fewer words than the previous meeting’s statement and revealed a unanimous decision, as expected, not to change the 1.5-1.75% federal funds target range. Today’s statement omits a lot of the forward guidance language such as the following from […] More