Central Bank Watch
Higher Turkish Reserve Requirements
November 17, 2010
On November 12, the Central Bank of the Republic of Turkey increased reserve requirements on local-currency denominated assets to 6.0% from 5.5%. That action followed a 400 basis point cut of the overnight borrowing rate unveiled the day before and reviewed here. The increase of reserve requirements should remove close to $1.5 billion equivalent from […] More
Central Bank Watch
A Sixth Consecutive Chilean Rate Hike
November 17, 2010
The Central Bank of Chile had slashed its policy interest rate during the first seven months of 2009 by 775 basis points from 8.25% to 0.5%, but about a third of that stimulus from last year has now been reversed following Tuesday’s announced increase of 25 basis points to 3.0%. Starting in June, the benchmark […] More
Deeper Analysis
U.S. Deflation Risk: Fact or Fancy?
November 17, 2010
The Fed is engaging in a second round of quantitative easing to ensure that the United States doesn’t slip into deflation. Deflation can be like a stroke in that full functionality sometimes never returns. Excessive inflation, in contrast, can always be conquered if monetary authorities have enough political backbone, which is why they tend to […] More
New Overnight Developments Abroad - Daily Update
EU Officials Scrambling to Defuse Irish Financial Strains
November 17, 2010
In a second day of meetings, Ecofin, EU finance ministers, seemed to be making progress on aid for Ireland. Irish talks with the EU, IMF, and ECB start tomorrow. Overnight movements of the dollar were minuscule. The euro is unchanged but remains softer than $1.35. The greenback is also unchanged on balance against the Canadian, […] More
