Larry's Blog
Surprises and Disappointments
June 27, 2011
Unexpected developments frequently are disappointing. Japan’s massive earthquake in March, which triggered a massive tsunami and serious nuclear facility accident, arguably top the lists of greatest disappointments and greatest surprises during the first half of 2011. Although Japan lies in geologically active region, it was not possible to know precisely where and when earthquakes will […] More
Central Bank Watch
Key Bank of Israel Interest Rate Not Changed
June 27, 2011
In leaving monetary policy unchanged for the coming month, a statement from the Bank of Israel made the following points: The key rate was raised from 2.0% to 3.25% between late January and late May. Despite a continuing high 4.1% rate of CPI on-year inflation in May, expected inflation has declined, and the underlying pace […] More
New Overnight Developments Abroad - Daily Update
New Concerns that Greek Lawmakers Might Not Approve New Austerity
June 27, 2011
Press reports in Greece that as many as four members of the ruling Socialist Party are have second thoughts about voting this week for the austerity plan sent the euro down as low as $1.4102, but such has recovered to 1.4213, up 0.2% on balance in nervous trading. Monday has a light slate of scheduled […] More
Deeper Analysis
More Help for Wounded Greece Creates More Trouble for Other EMU Members
June 26, 2011
An axiom among economists and investors is that the if the symptoms but not the causes of structural problems are addressed, the ultimate cost of repairing the problem will rise proportionately with the length of time that policymakers do not fix the real problem. Weekend press of the EU/IMF/ECB’s approach to Greece, providing aid in […] More
Foreign Exchange Insights and Next Week
Next Week
June 24, 2011
In this last week of June, Thursday will mark the passing of month-end, quarter-end and the mid-point of 2011. Highlights of the third quarter will be the August 2nd deadline for increasing the U.S. federal government debt ceiling, the tenth anniversary of the Al Qaeda attacks on the World Trade Center and the Pentagon, the […] More
Foreign Exchange Insights and Next Week
Focus on the Euro
June 24, 2011
The perceived insolvency of Greece continues to temper the euro’s strength. The common currency as of 18:00 GMT today was trading at $1.4176, down from Friday closing levels of 1.4289 on June 17, $1.4337 on June 10 and $1.4625 on June 3. A 2011 peak of $1.4941 on set on May 4. The euro has […] More
New Overnight Developments Abroad - Daily Update
A Better Market Tone
June 24, 2011
Equities rose 2.9% in India, 2.4% in China, 1.9% in Hong Kong, 1.7% in South Korea, 1.2% in The Philippines, 0.9% in Japan and Thailand, 0.7% in Indonesia and Singapore, and 0.2% in Australia. The Paris Cac, British Ftse, and German Dax are 1.7%, 1.4%, and 1.3% higher. The ten-year Japanese JGB yield touched a […] More
Deeper Analysis
U.S. Data Today Add to the Dismal Overnight Releases
June 23, 2011
Weak European data and the befuddlement of officials set a gloomy market tone before the United States opened. Three U.S. economic indicators released this morning haven’t helped the mood. New jobless insurance claims totaled 429K in the week of June 18 and averaged 426.5K over the past four reported weeks. In sequential four-week periods, the […] More
Central Bank Watch
Czech Monetary Policy Unchanged
June 23, 2011
The Czech Central Bank Board reaffirmed the 0.75% level on its key two-week repurchase rate. Eight reductions from August 2008 to May 2010 totaled 300 basis points. The last cut from 1.0% to 0.75% in May of last year was the only rate change made in 2010. Today’s action was universally anticipated. Current CPI inflation […] More
Central Bank Watch
Turkish Interest Rates Left Unchanged as Expected
June 23, 2011
Turkey’s unorthodox monetary experiment continues. The strategy implemented in late 2010/early 2011 combines low interest rates with a wider corridor between borrowing and lending rates, and higher reserve ratios and is intended to prevent second-order inflation from elevated commodity prices while also dissuading short-term capital inflows and dampening upward pressure on the lira that undermines […] More
