Draghi

Dollar Little Affected by Risk Aversion in Other Markets

April 20, 2016

Stocks in China, Hong Kong and Taiwan slumped 2.3%, 1.5%, and 1.4%.  A Chinese central bank official implied lessening inclination to ease. West Texas Intermediate crude oil dropped 2.3% to $40.14 per barrel on news that Kuwaiti workers called off their strike. The 10-year Japanese JGB yield dipped another basis point to a record low […] More

More Diversified Financial Market Movements

February 4, 2016

At least for today, it’s no longer a matter of risk-on or risk-off for all assets.  Some of this differentiation stems from more blatant currency warfare. Yesteday’s revealed sharp decline in the U.S. non-manufacturing purchasing managers index triggered a dollar sell-off.  The U.S. currency today has fallen by an additional 0.7% against the euro and […] More

Chinese Equities Record Second Largest Fall This Month

January 26, 2016

The Shanghai Composite index plunged 6.4% to a 13-month low and is now down almost 50% since last June.  Although the yuan is unchanged on the day, there’s much concern that it will devalue considerably further given the very high pace of Chinese capital outflows. In other equity market action around the Pacific Rim, stocks […] More

Central Banks Stand Down

January 21, 2016

In these tumultuous times, it would not be surprising to see monetary policy changes taken to help dissipate the high level of market fear.  Instead, The ECB Governing Council retained its interest rate structure, consisting of a 0.05% refinancing rate flanked by a negative 0.30% deposit rate and a +0.25% marginal lending rate. Brazil’s monetary […] More

Last Meaningful Week of 2015

December 14, 2015

A lot of information including a likely first federal funds rate hike since June 2006 will be crammed into this third week of December.  Such will clear the decks for the end-of-year holiday season, and trading desks will be closing their 2015 books.  Back in the day, there was no more consistent reliable bias in […] More

Mixed Central Bank Signals Lifted the Dollar

November 20, 2015

Stanley Fisher, Vice Fed Chair, said some major central banks, meaning the Fed, could move away from a zero interest rate policy relatively soon, noting also that Fed officials want to avoid the element of surprise and that counterparts in in emerging markets are ready for an initial Fed move. Atlanta Fed President Lockhart indicated […] More

Draghi, Yellen and Greece in the News

July 16, 2015

Not much data were released in Asia and Europe today. ECB President Draghi’s press conference at 12:30 GMT will be dominated by questions about Greece.  As expected, ECB interest rates were left unchanged by the Governing Council.  The refinancing rate, deposit rate, and marginal lending rate stay at 0.05%, -0.20%, and 0.30%. With violent protests […] More

Many Competing Stories but a Unifying Theme is Better Growth in Europe by a Slower Trend Elsewhere

April 15, 2015

ECB President Draghi is wrapping up his press conference.  Policy wasn’t changed further.  Focus is currently on full implementation of policy initiatives taken recently.  Draghi finds the favorable impact of quantitative easing to be impressive: real interest rates have fallen as expected inflation is rising.  An important new sentence in the released statement explains what […] More

Market-Moving Comments and Then a Chinese Interest Rate Cut

November 21, 2014

ECB President Draghi gave a dovish speech reaffirming the central bank’s readiness to take further action to lift inflation back to target. U.S. President Obama spoke to the nation in prime time, announcing plans to permit some 5 million undocumented residents not to be deported. San Francisco Federal Reserve President Williams warned about the danger […] More

ECB Hidden Agenda: Weaker Euro

November 6, 2014

The ECB didn’t change its three interest rates.  The refinancing rate of 0.05% has been flanked by a marginal lending rate of 0.3% and a deposit rate of -0.20%.  Each was cut by 10 basis points in September. Draghi’s main message, emphasized in his press conference, is that the ECB balance sheet will be expanding […] More

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