Canadian Recession Getting Worse
March 23, 2009
Canadian real GDP dropped 3.4% at a seasonally adjusted annual rate (saar) last quarter. That was the second negative quarter of 2008. GDP had fallen 0.9% saar in the first quarter, and in between there were tiny positive growth readings of 0.6% saar in 2Q and 0.9% saar in the third quarter. GDP increased only […] More
Central Bank Watch
Magyar Nemzeti Bank Left Repo Rate at 9.5%
March 23, 2009
Hungary’s central bank left its benchmark interest rate unchanged as expected and released a statement that identified supporting the forint and avoiding the adverse ramifications of further currency depreciation as the dominant policy guide at this time. The CPI has fallen to levels that officials consider consistent with price stability. but higher import prices are […] More
New Overnight Developments Abroad - Daily Update
New Overnight Developments Abroad: U.S. Unveils Details of Toxic Asset Buying Plan
March 23, 2009
Markets reacted well initially to new details of the U.S. plan to purchase bad bank assets. Treasury Secretary revealed new details in an Op-Ed WSJ column and speaks at 12:45 GMT this morning. Fed, FDIC and Treasury all to play a role. Much of the money to come from government. Some fundamental questions still not […] More
Central Bank Watch
Two South American Central Banks Cut Key Rates
March 20, 2009
The Bank of Mexico cut its key interest rate by a greater-than-expected 75 basis points to 6.75 and released a statement blaming a worsening global economic crisis. This was the second reduction this year following one of 50 basis points in January. The central bank rate is now only about a half-percentage point above on-year […] More
Foreign Exchange Insights and Next Week
Next Week
March 20, 2009
Next week has neither a big slate of top tier data releases nor any scheduled central bank interest rate meetings in the advanced economies. The United States reports the third and final reading of fourth-quarter GDP, existing and new home sales, personal income and consumption, durable goods orders and the U. Michigan consumer sentiment index. […] More
Foreign Exchange Insights and Next Week
Weekly Foreign Exchange Insights: March 20th
March 20, 2009
The dollar experienced heavy selling pressure this week but has recouped some losses today in mid-day New York trading. Price action on a Friday can be misleading especially if not associated with a data shocker that day or if significant change during the week is simply getting trimmed. Both of these qualifying conditions apply to […] More
Central Bank Watch
A Fifth Straight Large Rate Cut in Turkey
March 20, 2009
The Central Bank of Turkey cut its key rates yesterday by 100 basis points and indicated that an easing policy bias would likely be retained for “a considerable period.” Previous rate cuts amounted to 100 basis points in November, 125 basis points in December, 200 basis points in January and 150 basis points in February. […] More
New Overnight Developments Abroad - Daily Update
New Overnight Developments Abroad: Commodity Currencies Stronger
March 20, 2009
Gold firmed another 0.4% to $962.90 per ounce and has advanced 7.2% over the ten days since March 10, buoyed partly by concerns that Fed stimulus will spark inflation. Oil eased 0.8% but remains above $50 at $51.20 per barrel. Commodity-sensitive currencies climbed further against the greenback: kiwi up 1.0%, Australian dollar +0.8%, and Canadian […] More
Central Bank Watch
Quantitative Easing British Style
March 19, 2009
The Monetary Policy Committee meeting of March 4-5th advanced British monetary policy far down the road of quantitative easing. By a 9-0 vote, the Bank of England Halved its Bank Rate to 0.5%. Agreed to finance Gbp 75 billion of asset purchases by creating central bank reserves, that is printing money. This will be done […] More
Inflation in February
March 19, 2009
Several countries have reported higher-than-forecast inflation this month, this morning’s Canadian figures constituting the latest example. Canada’s CPI rose 0.7% in February not seasonally adjusted and 0.4% when adjusted. Core CPI, up 0.3%, also exceeded street estimates. On-year inflation increased to 1.4% from 1.1% in January, and core failed to drop under the January 12-month […] More
