Central Bank Watch
Mexican Monetary Policy Stays on Hold as Expected
May 21, 2010
The Bank of Mexico retained a 4.5% benchmark interest rates, which represents a 6-1/2 year low. The rate was cut in seven steps from 8.25% at the start of 2009 to its present level by last July. Mexico is again achieving positive economic growth, but such is being powered almost entirely by net foreign demand […] More
Foreign Exchange Insights and Next Week
Next Week
May 21, 2010
Each currency market year can be divided into three trading seasons. The middle or summer period runs between the U.S. Memorial Day and Labor Day holiday weekends. The coming week will be the 21st and final one of this year’s first trading season. U.S. Treasury market desks will close early next Friday. Canada will be […] More
Foreign Exchange Insights and Next Week
Chaotic Currency Conditions Likely to Continue
May 21, 2010
The European debt crisis rolls onward. No enduring solution to the problem exists. Investors for starters want to see Greece, Portugal, and Spain implement very sharp, multiyear programs of deficit reduction and debt containment but would fear the impact on regional growth and would remain dissatisfied if they got their wish. Currencies are only one […] More
Central Bank Watch
Bank of Japan: More Show Than Substance
May 21, 2010
The Policy Board’s late May meeting, slightly more than six hours of discussions over two days, took the following actions: Left its rate for uncollateralized overnight loans at 0.1%. The vote was 8-0. Unveiled a framework for 1-year lending to banks against pooled collateral at the overnight rate level. In turn, banks are obligated to […] More
New Overnight Developments Abroad - Daily Update
Forex Intervention Rumors
May 21, 2010
Currency markets have become very sensitive to the possibility of central bank intervention. A 1.4% recovery of the Aussie dollar against the greenback is being attributed to possible buying by the Reserve Bank of Australia, and the Swiss National Bank reportedly continued to sell francs against the euro. There’s even talk of Japanese officials acting […] More
