Central Bank Watch
Two Latin American Central Banks Eased on Thursday
May 8, 2009
The Central Reserve Bank of Peru cut its benchmark policy reference rate by 100 basis points to 4%. A cut of that size was also done in April following back-to-back smaller reductions of 25 basis points each in February and March. The cyclical peak of 6.5% was attained last October after an increase that month […] More
Central Bank Watch
Czech National Bank Eases by 25 Basis points
May 7, 2009
The Czech key two-week repo rate has been cut by an as-expected 25 basis points to 1.5%. The discount rate and Lombard rate were also reduced by 25 bps to 0.5% and 2.5%. This was the central bank’s fifth rate cut of this cycle. Earlier easings amounted to 50 basis points on February 6 and […] More
Central Bank Watch
Central Bank of Iceland Slashes Key Rate to 13% from 15.5%
May 7, 2009
The statement by Icelandic monetary authorities frames today’s 250-basis point rate cut as part of a shifting macroeconomic policy mix toward tighter fiscal policy and easier monetary policy. Prospects for krona appreciation in the medium-to-longer term, greater disinflation than expected previously, and an endogenous tightening of monetary conditions as commercial bank operations normalize also justify […] More
Central Bank Watch
Review of ECB Actions and Press Conference
May 7, 2009
The refinancing rate was cut by 25 basis points to 1.0%. This was the seventh cut since October from a peak of 4.25%. Four of the cuts were by 50 bps, but just one exceeded that size, a 75-bp cut in December. April’s reduction, like this one, was by 25 basis points. The deposit rate/marginal […] More
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Currency Thoughts Hits 1000 Postings
May 7, 2009
My review of the Bank of England statement below was the 1000th post of this blog. If you haven’t already done so, please take a couple of minutes to fill out the brief customer satisfaction survey to make the next thousand posts even more useful. Thank you for your support. More
Central Bank Watch
A Bank of England Surprise
May 7, 2009
The Monetary Policy Committee, which had not been expected to announce any policy changes, instead extended its asset purchase plan by Gbp 50 billion and for two more months. In March, officials had said they would buy Gbp 75 billion of mostly government but also some corporate debt over a period of three months through […] More
New Overnight Developments Abroad - Daily Update
New Overnight Developments Abroad: Focus on Stress Test Results and ECB
May 7, 2009
Many big events today, headed by the U.S. stress test results for banks due at 20:00 GMT (much of which has been leaked already) but also the ECB at 11:45 GMT, and U.S. jobless claims, productivity and unit labor costs at 12:30 GMT. The Bank of England unexpectedly increased its asset purchase program by another […] More
British PMIs Depict Lessening Weakness
May 6, 2009
The U.K. PMIs bottomed in November but remain below a reading of 50. This suggests more quarters of negative growth but not quite as much so as the 7.4% annualized decrease of GDP last quarter. Britain’s manufacturing PMI printed in April at 42.9, 3.4 points higher than in March, 6.2 points greater than its first-quarter […] More
Central Bank Watch
Central Bank of Romania Eases 50 Basis Points, Too
May 6, 2009
Romania’s monetary policy rate was cut today to 9.5% from 10.%. This is the second reduction of 2009 following a 25-bp cut on February 4th. Analysts leaned toward expected another 25-bp cut today. In 2008 when inflation rose and the Romanian lei like many Eastern European currencies depreciated sharply, Romania’s central bank implemented six hikes […] More
Central Bank Watch
Norwegian Central Bank Rate Cut By 50 Basis Points to 1.5%
May 6, 2009
Norges Bank officials have implemented their sixth rate reduction since October 15th. The 50-bp size of the move was as analysts had forecast. Five of the six cuts were by 50 bps, the exception being a mega-175 basis point cut in mid-December. A brief statement from monetary officials makes no reference to possible future policy […] More
