Foreign Exchange Insights and Next Week
Bad Week for the Dollar
February 18, 2011
At 17:30 GMT today, the dollar showed losses for the week of February 18 of 2.7% against the Swiss franc, 1.4% against sterling, 1.3% versus the Australian dollar, 1.0% against the euro, 0.4% against the New Zealand and Canadian dollars, and 0.3% against the yen and yuan. The backdrop to this across-the-board depreciation of the […] More
New Overnight Developments Abroad - Daily Update
Chinese Reserve Requirements Tightened as G20 Finance Ministers Meet
February 18, 2011
Reserve ratios for large Chinese banks were lifted to 19.5% from 19.0%, effective February 24. There had been six increases of the ratio during 2010, the final three of which were crammed into five weeks in November and December. Last October, December and January, officials at the Peoples Bank of China raised interest rates by […] More
New Overnight Developments Abroad - Daily Update
A Softer Dollar
February 17, 2011
Continuing unrest and uncertainty in the Middle East has not prevented the dollar from falling 1.0% against the Swiss franc, 0.6% relative to the Australian dollar, 0.5% against the yen, 0.4% versus sterling, 0.3% against the euro and kiwi and 0.2% versus the Canadian dollar. Dollar/yuan is steady. The DJIA is down 0.4%. The Ftse […] More
New Overnight Developments Abroad - Daily Update
Sterling Weakened After Release of Bank of England Report
February 16, 2011
The pound fell 0.7% against the dollar, depressed by the Bank of England’s quarterly Inflation Report, which predicted sub-2% CPI inflation late next year if rates were to rise as markets are discounting. Projected British growth was revised downward because of the fiscal austerity. Higher than expected inflation now and somewhat higher expected inflation do […] More
Central Bank Watch
Turkey’s Unorthodox Monetary Policy Paused
February 15, 2011
No additional policy changes have been undertaken by the Central Bank of the Republic of Turkey. Like many emerging economies, Turkey has experienced higher inflation. Whereas other central banks have raised interest rates, Turkey lowered them. The one-week repo rate was cut by 50 basis points in December and another 25 basis points to 6.25% […] More
Central Bank Watch
Swedish Rate Hike
February 15, 2011
The Riksbank Executive Board has implemented a fifth repo rate increase of 25 basis points following similar increments last July 1, September 2, October 25 and December 15. The rate level becomes 1.5%, compared to a cyclical low of 0.25%. A statement released by the central bank cites the same four reasons for today’s move […] More
New Overnight Developments Abroad - Daily Update
Very Busy Day
February 15, 2011
Central bank decisions have been announced in Japan, Sweden and Turkey. Euroland fourth-quarter GDP figures were weaker than forecast. The United States released retail sales, import prices and international capital flows, while Britain reported a 4.0% on-year rate of CPI inflation, most since November 2008 and twice the targeted pace. The dollar is mixed, falling […] More
Central Bank Watch
Bank of Japan Policy Left Unchanged
February 14, 2011
After meeting for five hours and 52 minutes over two days, the Policy Board agreed unanimously to retain a virtual zero interest rate monetary policy stance (ZIRP). Since October 5, the target on uncollateralized overnight call money has been zero to 0.1%. The target had previously been around 0.1% since December 2008, and it has […] More
New Overnight Developments Abroad - Daily Update
Stronger Asian Stocks and Softer Euro to Start the Week
February 14, 2011
The euro and kiwi are down against the dollar by 0.7% and 0.6%. Other major dollar pairs have changed no more than 0.1% since Friday’s close. Equities rose 3.2% in China, 2.7% in India, 1.9% in South Korea, 1.3% in the Philippines and Hong Kong, 1.8% in Thailand, and 1.1% in Japan and Australia. The […] More
Deeper Analysis
Japanese Fourth Quarter GDP Contracted 1.1% annualized
February 13, 2011
The 1.1% drop in GDP last quarter was about half as steep as feared. Real GDP still advanced 3.9% in 2010, the most since 1990. The main sources of growth in 2010 came from net exports (1.8 percentage points), personal consumption (1.1 ppts) and inventories (0.6 ppts). Government spending, residential investment and non-residential investment made […] More
