Currency Markets in the News
Reading Japan
July 23, 2008
Markets are bracing for another end-month round of weak Japanese indicators. A consensus is building that 2H08 might even be recessionary. The long-awaited pick-up of Japanese inflation has not been welcome. Deflation battered growth in the 1990’s and at the turn of the century. A restoration of headline consumer price inflation of more than 1% […] More
Canadian Retail Sales Squeezed by Higher Inflation
July 23, 2008
Total CPI inflation in Canada rose 3.1% in the year to June, more than double the 1.4% on-year pace in March. A more acute sense of this acceleration can be observed in seasonally adjusted consumer prices, which advanced 4.5% at an annualized rate during the first half of 2008 compared to just 1.4% in the […] More
New Overnight Developments Abroad - Daily Update
New Developments Abroad: Oil Price Drop Extended
July 23, 2008
Oil prices fell another 1.9% to $125.95/barrel overnight, extending their decline since the July 11 peak to 14.5%. Gold dropped 1.5% to $934.70/ounce. The dollar is higher except for a 0.2% dip against sterling. Gains range from 1.0% versus the kiwi to 0.7% against the Aussie dollar, 0.3% relative to the yen, euro and Swissy, […] More
Long-Term Dollar Prospects
July 22, 2008
The basis for U.S. Treasury Secretary Paulson’s faith in a stronger dollar over the long run rests on the assertion that no other developed economy has better long-term fundamentals than America. There’s that poorly defined word again, fundamentals, which officials and private analysts throw around too much. Fundamentals, like beauty, are in the eyes of […] More
Canada's Bipolar Economy
July 22, 2008
Officials at the Bank of Canada project Canadian GDP growth of just 1.5% in the second half of 2008, which compares to theoretical trend growth in the period of 2.8% if productive resources were to be fully utilized. They anticipate drags from net foreign demand of 1.9 percentage points in full-2008 and 1.1 ppts in […] More
New Overnight Developments Abroad - Daily Update
New Developments Abroad: Nikkei Rallies
July 22, 2008
The Nikkei climbed 381 points or 3.0%. Other Asian stocks were fairly flat. In Europe, the Dax and Cac40 are 0.7% lower. Ftse is off 1.4%. Scantl movement in the dollar: flat against the yen, euro and sterling, up 0.3% against the C-dollar, and off 0.1% versus Swissy, kiwi and A-dollar. The 10-year JGB yield […] More
Currency Markets in the News
German Inflation Depresses Financial Market Sentiment
July 21, 2008
Similar to Britain (see previous post), German inflation is too high at all levels but looks most worrisome at earlier stages of production. Consumer prices advanced 3.3% in the year to June but advanced at a slightly lower 3.1% annualized rate in 1H08 than the 3.5% rate in 2H07. The deceleration was pronounced outside of […] More
Should U.K. Inflation Be Ignored?
July 21, 2008
David Blanchflower, a member of the Bank of England 9-person monetary policy committee and an economics professor at Dartmouth College, has publicly characterized the central bank stance as inappropriately tight. He escalated his warnings today, suggesting that since Britain’s housing correction is likely to be as severe as America’s but without the offsetting macroeconomic easing […] More
Chinese Growth Still High
July 21, 2008
Although on-year real GDP growth slowed from 11.9% in 2Q07 to 11.7% in 4Q07 and 10.1% in 2Q08, underlying growth in the first half of 2008 surpassed 10.0% and was about a percentage point stronger than in the fourth quarter of 2007. The main loss of steam has been in export growth, which weakened to […] More
New Overnight Developments Abroad - Daily Update
New Developments Abroad: Asian Equities Higher
July 21, 2008
Equities advanced strongly in Asia by 3.4% in China, 3.5% in South Korea, 2.6% in Thailand, 2.5% in Indonesia, 3.0% in Hong Kong, 3.5% in Australia, and 1.6% in India. Japanese markets were closed for Ocean Day. In Europe, the Paris Cac is 1.7% higher, but the British Ftse (+0.2%) and German Dax (0.0%) are […] More
