Central Bank Watch

South African Repo Rate cut 25 Basis Points to 6.5%

July 18, 2019

The South African Reserve Bank by unanimous vote has implemented its first interest rate cut in 16 months, a 25-basis point cut of the repo rate to 6.5%. A released statement observes moderating inflation expectations, signaled policy easing by advanced economy central banks, weaker-than-anticipated global economic activity, and “escalating trade and geo-political tensions.” Officials expected […] More

Second Rate Reduction in Ukraine

July 18, 2019

The National Bank of Ukraine implemented the second move of an easing cycle, cutting its discount rate to 17.0% from 17.5%. A half percentage point cut had been also done in April. A released statement asserts that inflation of 9% is on track to keep falling toward the 5% target and should reach that goal […] More

Bank Indonesia Eases

July 18, 2019

Bank Indonesia’s key 7-day reverse repo rate was reduced to 5.75% from 6.0%. It’s the first cut since September 2017. The previous changes were a pair of hikes in September and November of 2018. Today’s easing was justified by in-target inflation, lessening pressure on Indonesia’s balance of payments, and the expectation of easier Fed policy […] More

Bank of Korea

July 18, 2019

The Bank of Korea’s 7-day repo rate was sliced to 1.50% from 1.75% in a move that surprised some analysts and which was ascribed to mounting trade tensions, easing monetary policies in other economies, and geopolitical risks. In taking this step, monetary authorities revised projected GDP growth this year slightly downward from 2.5% to something […] More

Reserve Bank of Australia Cuts Interest Rate as Expected to New Record Low of 1.0%

July 2, 2019

The Board of the Reserve Bank of Australia engineered a second consecutive 25-basis point reduction of its Official Cash Rate, which now drops to a record low 1.0%. A released statement asserts a readiness to act further if deemed necessary: “The Board will continue to monitor developments in the labor market closely and adjust monetary […] More

Central Bank Rate Cut in Iceland

June 26, 2019

The Central Bank of Iceland’s 7-day term rate has been cut 25 basis points to 3.75% following a 50-basis point reduction at the prior monetary policy review last month. These moves represent a trend reversal from a 25-basis point increase last November.  In a released statement explaining the decision, officials anticipate a contraction of domestic […] More

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