ECB
ECB Review
March 8, 2012
The ECB delivered no surprises. Interest rates were left unchanged. Projected growth in 2012 and 2013 was revised downward, while projected inflation especially in 2012 was revised upward mainly to take account of higher energy prices and indirect taxation. Risks to the growth forecast are skewed to the downside, and those to prices are large [...] More
ECB Preview
March 7, 2012
There likely will be no further changes of ECB policy, which has eased extensively since Draghi assumed the central bank’s presidency some four months ago. New quarterly growth and inflation projections are due, however, and the table below gives the history of changes in those range estimates. GDP 2011 GDP 2012 GDP 2013 CPI [...] More
Big Day for Central Banks But Watching Greece Too
February 9, 2012
The Bank of England’s Monetary Policy Committee expanded quantitative easing as many thought it would. The Asset Purchase Program’s ceiling was raised to GBP 325 billion from GBP 285 billion. This extension is expected to take three months to complete. The Bank rate was held steady at 0.5%. The European Central Bank will announce its [...] More
ECB Doesn’t Send a Message of Urgency to Ease Further
January 12, 2012
The ECB announced no new stimulus steps, having done plenty in December. In contrast to the expectation of substantial further policy easing in February or March by many analysts, today’s statement and comments to the press did not offer reinforcing verbal support for that belief. In his third press conference since taking the helm of [...] More
Waiting for Draghi’s Press Conference and U.S. Retail Sales
January 12, 2012
Equities show overnight gains of 1.4% in Germany and 1.2% in France ahead of the ECB policy announcement and monthly press conference. The dollar is down 0.3% against the euro and 0.5% softer relative to the Swiss franc. The dollar otherwise has dipped 0.2% against the loonie and 0.1% versus sterling, while firming 0.1% against [...] More
ECB Preview
January 11, 2012
Opinions are mixed over whether ECB policy will be eased for a third consecutive month in January, but the majority view, partly because there were some dissenters against the rate cut in December, looks for the Governing Council to pause, pending more information. Actions have been more accommodative than the bank’s rhetoric, which puts the [...] More
After the Christmas Break
December 27, 2011
A few markets remain shut for Boxing Day (Britain, Australia, Hong Kong and New Zealand), but most reopened. In thin volume, price movements have been limited. The dollar is down 0.3% against sterling, 0.2% against the yen and 0.1% versus the euro and Swissie. The greenback faired better against commodity-sensitive currencies, edging up 0.2% relative [...] More
Better Market Tone of Yesterday Holding So Far… A Big ECB 3-Year Infusion of Bank Liquidity Helped
December 21, 2011
Equities in the Pacific Rim mostly rose, advancing 4.6% in Taiwan, 3.4% in South Korea and India, 2.1% in Australia, 2.3% in Singapore, 1.9% in Hong Kong, 1.5% in Japan and 1.4% in Malaysia. An exception to the trend was a 1.6% drop in Chinese share prices, but in Europe, stocks have recovered by a [...] More
Mixed Message from the ECB, and Markets Weaken in Response
December 8, 2011
The good news was a rate cut of 25 basis points, downwardly revised forecasts of inflation, and a number of unconventional measure modifications to facilitate the transmission of policy. The ECB, for instance, will now do a few three-year fixed rate refinancing operations, exceeding the prior limit of a one-year maturity. Rules on eligible collateral [...] More
Firmer Yen Ahead of ECB and Bank of England Decisions
December 8, 2011
Analysts are projecting a likely ECB rate cut at 12:45 GMT. Just in from the Bank of England is confirmation of no change in its monetary policy settings of a 0.5% Bank Rate and a GBP 275 billion ceiling on asset buying. There have been some bad vibrations out of Brussels, suggesting continuing disagreement over [...] More
