New Overnight Developments Abroad - Daily Update

Overnight Action Dominated by Subpar Tech Company Earnings… Now Investors Await U.S. January Jobs Data

February 3, 2023

North American stock futures and European share prices are mostly down with major tech firms like Alphabet, Amazon, and Apple leading the way. Such concerns also affected some key Asian stock exchanges where the Hang Seng and Shanghai Composite indices lost 1.4% and 0.7%. Yesterday’s big drop in European 10-year sovereign debt yields was reversed […] Read Article

Foreign Exchange Insights and Next Week

Next Week’s Menu: January 2 – February 3, 2023

January 27, 2023

Central Banks: Monetary policies will be reviewed at the Federal Reserve, Bank of England, European Central Bank, Bank of Brazil and Czech National Bank. Fed Chairman Powell, ECB President Lagarde, and Bank of England will hold press conferences. Special Event: OPEC Plus officials hold a meeting on Thursday. January Purchasing Manager Surveys: Surveys of manufacturers […] Read Article

Central Bank Watch

European Central Bank

February 2, 2023

The European Central Bank was late to join the rate hiking party. The refinancing rate rate was at zero percent as recently as mid-2022, but officials made up for lost time in the second half of the year, enacting 250 basis points of increase in four incremental moves. Today’s 50-basis point hike to 3.0% matched […] Read Article

Deeper Analysis

January 2023 in Figures

January 31, 2023

The Bank of Canada was the only Group of Seven central bank to change its policy interest rate during January, but many others engineered adjustments during the month. Like the Bank of Canada, central banks in Israel, those in Romania, Israel, Serbia, Peru, South Korea, Indonesia, Thailand, and South Africa enacted rate hikes of 25 […] Read Article

Central Bank Watch

Bank of England

February 2, 2023

The Bank of England‘s 50-basis point base rate hike to 4.0% was not supported unanimously. Monetary Policy Committee members Tenreyro and Dhingra voted to leave the rate unchanged in a 7-2 decision, citing a recession already underway that is likely to soften labor market conditions in light of the lagged impact of earlier monetary restraint […] More

New Overnight Developments Abroad - Daily Update

More Central Bank Policy Rates Get Raised 10-Year Sovereign Debt Yields Drop

February 2, 2023

Officials at the European Central Bank and Bank of England raised their policy interest rate by 50 basis points to their highest levels since 2008. The size of those increases matched expectations. The policy rates of the Hong Kong and Macao Monetary Authorities matched the Fed’s 25-basis point increase. Brazil’s Selic interest rate was kept […] More

Central Bank Watch

FOMC Statement and Powell Press Conference

February 1, 2023

The FOMC agreed to the as-expected 25-basis point interest rate hike, lifting the federal funds target range to 4.50-4.75%, and to continuing the balance sheet reduction by not reinvesting all maturing assets purchased when the Fed was easing in a quantitative way. Not only was the size of the interest rate hike the smallest since […] More

Central Bank Watch

FOMC Preview

February 1, 2023

Beginning last March, the federal funds rate target was increased at the last seven scheduled FOMC meetings in 2022 by a total 425 basis points to a range of 4.25-4.50%. Forward guidance has lately been framed around three questions: how much to lift at each instance — how high does the rate need to be […] More

New Overnight Developments Abroad - Daily Update

Much More Than an FOMC Announcement Day

February 1, 2023

The FOMC policy statement at 19:00 GMT today (14:00 EST) will be followed half an hour later by the start of Chairman Powell’s press conference. Officials are expected to raise the target federal funds corridor by 25 basis points to 4.50-4.75%. This is the first scheduled FOMC meeting of 2023 and therefore the one in […] More

New Overnight Developments Abroad - Daily Update

Heavy Data Menu, Updated IMF World Economic Outlook, and the FOMC Begins Two-Day Policy Review

January 31, 2023

On this last day of January, the weighted DXY dollar index has edged 0.1% higher but will post its fourth monthly decline in a row. Overnight dollar rises were strongest against the the Aussie dollar (0.9%), kiwi (0.6%), and sterling and loonie (both up 0.4%), but the euro slid only 0.1%, the Swiss franc is […] More

Central Bank Watch

Central Bank of Ghana’s Latest Rate Hike Is Smaller than the Previous Five Moves

January 30, 2023

In Ghana, where consumer price inflation soared from 12.6% at end-2021 to 54.1% last month, officials at the Bank of Ghana increased the policy interest rate from 14.5% coming into March 2022 to 27.0% by last November. The near doubling was accomplished in just five months, with increments of 250 basis points in March, October […] More

New Overnight Developments Abroad - Daily Update

Share and Bond Prices Fall, Dollar Little Changed Ahead of Tuesday-Wednesday FOMC Meeting

January 30, 2023

U.S. equity futures point to a drop of around 1% at the opening bell. Share prices closed down 2.7% in Hong Kong, 1.4% in South Korea, 0.5% in Singapore, 0.4% in Indonesia but up 0.2% in Japan and 0.1% in China. Major European stock exchanges are down about 0.5% thus far. Ten-year sovereign bond yields […] More

New Overnight Developments Abroad - Daily Update

Some Fresh Concerns

January 27, 2023

While awaiting the monthly U.S. report on personal income, personal consumption, and the Fed’s favored PCE price deflator, investors got some disquieting price news from other countries. In Japan where consumer price data for Tokyo are reported a month earlier than national statistics, today’s January figures showed an acceleration of the total CPI to a […] More

Uncategorized

Today’s South African Reserve Bank Rate Hike of 25 Basis Points Was Less Than Predicted

January 26, 2023

Instead of a 50-basis point rate hike to 7.50% by a 3-2 vote of policymakers, the five-person Monetary Policy Committee voted 3-2 to increase South Africa’s repo rate to 7.25%. The interest rate had been at 6.5% coming into the pandemic year of 2020 and was sliced to 3.5% in five moves by May of […] More

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