Larry's Blog
U.S. Government Spending
March 4, 2010
President Obama has been criticized for overseeing a big additional rise of the government deficit. The recession, not discretionary policy change, is the primary factor behind the advancing fiscal shortfall. During economic downturns, tax revenues automatically shrink, and many expenditures such as unemployment insurance payments increase as the number of claimants climbs. Claims peaked near […] More
Central Bank Watch
Malaysian Monetary Policy Tightened
March 4, 2010
Bank Negara Malyasia today raised its overnight policy rate for the first time since April 6, 2006. From a 2.5-year peak of 3.5%, such had been cut by 20 basis points in November 2008, 75 bps in January 2009 and 50 bps to 2.0% in February 2009 where such stood until today. Today’s hike of […] More
Central Bank Watch
ECB: Threading a Narrow Path
March 4, 2010
The ECB today conveyed several things. It Announced a return to variable rate refinancing operations as of April 28th but made no change in it main weekly fixed rate tenders or its one-month tenders. They will continue as they’ve been into October. The final six-month tender on March 31 will carry the average minimum rate […] More
Central Bank Watch
Bank Indonesia Left Policy Rate at 6.5%
March 4, 2010
Indonesian monetary policy will remain steady as expected. The policy rate has been at 6.5% since 300 basis points of easing between December 2008 and August 2009 were completed. No increase is anticipated until at least midyear. Although economic growth has firmed faster than anticipated, core inflation fell in February, and both it (3.9%) and […] More
Central Bank Watch
Bank of England Policy Unchanged
March 4, 2010
To nobody’s surprise, the Monetary Policy Committee announced a decision to leave its bank rate at 0.5%, where such has been for the past year, and not to increase its asset purchase program beyond the Gbp 200 billion limit that was reached in January. Minutes of today’s meeting due March 17 will likely show another […] More
New Overnight Developments Abroad - Daily Update
Most Key Dollar Pairs Steady Awaiting Bank of England and ECB
March 4, 2010
The dollar has risen 0.2% against the Swiss and 0.1% versus sterling and the euro, but the greenback is down 0.2% against the Canadian dollar and 0.1% versus the yen. Bigger dollar moves have been made against the kiwi (+0.6%) and Aussie dollar (+0.3%). Pacific Rim stocks fell mostly with drops of 2.5% in China, […] More
