Central Bank Watch

Brazilian and Indian Monetary Policy Decisions

August 1, 2018

Central Banks in two of the four BRIC economies held monetary policy reviews. Coincidentally, while the Brazilian Selic rate was left unchanged at 6.50%, the Indian repo rate was lifted 25 basis points to rest also at 6.50%. Previously, the Selic rate was lowered sharply by 50 basis points in 2016, 675 bps last year […] More

Central Bank Watch

FOMC Leaves Interest Rate Unchanged, Upgrades GDP and Personal Consumption Assessments

August 1, 2018

Today’s statement sets the stage for a likely eighth interest rate hike at the next FOMC meeting in September. Assessments of overall growth and the key consumption component of demand were each upgraded to “strong.” Policy continues to be characterized as accommodative and thereby supportive of “strong labor market conditions and a sustained return to […] More

Central Bank Watch

FOMC Preview

August 1, 2018

The federal funds target in the current campaign of rate normalization has undergone seven 25-basis point increases, their dates being December 2015, December 2016, March, June and December of 2017, March 2018 and, most recently, on June 13th at its previous meeting. Today’s announcement at 14:00 EDT will not be accompanied by new forecasts nor […] More

Deeper Analysis

U.S.-Minus-Euroland Manufacturing PMI Spread Narrowed Sharply Last Month

August 1, 2018

Mfg PMIs U.S. Euroland Spread EUR/USD Jan 2013 53.1 47.9 +5.2 1.330 February 53.1 47.9 +5.2 1.334 March 51.5 46.8 +4.7 1.295 April 50.0 46.7 +3.3 1.301 May 50.0 48.3 +1.7 1.299 June 52.5 48.8 +3.7 1.319 July 54.9 50.3 +4.6 1.309 August 56.3 51.4 +4.9 1.331 September 56.0 51.1 +4.9 1.335 October 56.6 51.3 […] More

New Overnight Developments Abroad - Daily Update

Assessing July Factory PMIs and Awaiting FOMC Statement

August 1, 2018

A parade of more than twenty purchasing manufacturing indices released today showed weaker July than June conditions by a ratio of five to one. Today’s FOMC decision is neither expected to entail an interest rate change nor any back-down of resolve following President Trump’s criticism that the Fed has been too quick to raise interest […] More

Deeper Analysis

July in Figures

July 31, 2018

Net dollar movement against currencies in other well-developed economies was modest in July, but the U.S. currency extended gains against developing country monies. The rise in long-term U.S. interest rates pulled up other sovereign debt yields, blunting the impact on rate differentials. The Bank of Canada was the only central bank examined for this update […] More

Central Bank Watch

Bank of Japan

July 31, 2018

The Bank of Japan did not change its policy interest rates of negative 0.1% on overnight Policy-Rate balances or about zero percent on the 10-year JGBs. In controlling the yield curve, officials still expect to purchase about 80 trillion yen of JGBs per year, and the quantitative settings for purchases and/or holdings of ETFs, J-Reits, […] More

New Overnight Developments Abroad - Daily Update

Exhausting Barrage of Data and Developments on Final Day of July

July 31, 2018

The dollar recovered 0.4% against the yen while sliding 0.3% relative to the euro and Australian dollar, 0.2% versus sterling and 0.1% vis-a-vis the loonie and Swiss franc. The Bank of Japan changed the policy framework only marginally, which allowed the worried JGB market to settle down and the 10-year yield to slide back four […] More

New Overnight Developments Abroad - Daily Update

Big Rise in Sovereign Debt Yields Ahead of BOJ, FOMC, and BOE Policy Reviews Later This Week

July 30, 2018

Ten-year sovereign debt yields climbed so far today by 7 basis points in the U.K., 5 bps in Germany, France, Italy and Spain, and 3 bps in the United States. Share prices fell in the Pacific Rim by 0.7% in Japan, 0.8% in New Zealand, 0.5% in Hong Kong and Singapore, and 0.4% in Taiwan […] More

Foreign Exchange Insights and Next Week

Next Week

July 27, 2018

Central Banks: The Federal Reserve, Bank of England, and Bank of Japan lead a list of central banks reviewing monetary policy next week that also includes centrals in India, the Czech Republic, Sri Lanka, Brazil, and Mexico. An updated BOJ Outlook will be published, and Governor Kuroda will  hold a press conference. Governor Carney of […] More

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