Central Bank Watch
Reserve Requirement Lowered in India
January 24, 2012
Monetary officials at the Reserve Bank of India cut their cash reserve requirement to 5.5% from 6.0% but left the key 7.5% reverse repo rate and 8.5% repo rate unchanged. This combination of moves is expected to ease excessively tight liquidity conditions, mitigate a slowdown in growth, but also contain price pressures and anchor medium-term […] More
Central Bank Watch
Bank of Japan Downgrades Assessment But Leaves Policy Unchanged
January 24, 2012
Japan’s target overnight interest rate remains in a range of zero to 0.1% and the asset purchase plan’s size remains at JPY 55 trillion. The current interest rate has remained as such since October 2010, and quantitative easing was last expanded in October 2011. Current account balances held by banks with the BOJ have averaged […] More
New Overnight Developments Abroad - Daily Update
Concerns Mount as Greek PSI Deal Remains Elusive
January 24, 2012
The German Dax, Paris Cac and British Ftse have fallen 1.5%, 1.3%, and 0.9%. Many bourses in Asia remained shut for the Lunar New Year. Stocks fell 2.2% in Sri Lanka and 0.8% in New Zealand but rose 1.5% in India and 0.2% in Japan. The euro faltered after touching $1.3065, its strongest level since […] More
Central Bank Watch
Bank of Japan Preview: Bigger Asset Purchase Plan Possible
January 23, 2012
The BOJ Policy Board is holding its first meeting of 2012, a 2-day deliberation that concludes Tuesday. The target for the overnight uncollateralized money rate will be reaffirmed unanimously at a range of zero to 0.1% since October 2010. This policy is sometimes called ZIRP and was popularlized in Japan in 1999-2000 and again 2001-6. […] More
Central Bank Watch
A Third and Somewhat Unexpected Rate Cut by the Bank of Israel
January 23, 2012
No central bank was quicker than Israel’s in raising interest rates after the Great Recession. Having slashed such from 4.25% to 0.5% during the downturn, the Bank of Israel began the process of normalization with a 25-bp increase in August 2009. Nine ensuing rate hikes lifted the benchmark to 3.25% by May of last year. […] More
Central Bank Watch
Bank of Mexico Monetary Policy Unchanged
January 23, 2012
Policymakers at Mexico’s central bank last Friday decided to keep its key interest rate at 4.5%, the level since a cut in July 2009 culminated 375 basis points of easing implemented that year. A statement from officials projects that inflation, though currently somewhat above the 3% target, will settled into that goal. Risks to growth […] More
New Overnight Developments Abroad - Daily Update
EU Finance Ministers Meeting Today
January 23, 2012
A slow start to the week, as many Asian markets were closed for the Lunar New Year holiday. Closed markets include Hong Kong, China, South Korea, Indonesia, Malaysia, The Philippines, Taiwan, Singapore and Vietnam. In contrast to today, Tuesday through Friday each have big event and data calendars this week. European finance ministers will be […] More
Foreign Exchange Insights and Next Week
Next Week
January 20, 2012
Central bank interest rate policy meetings are scheduled next week in the United States, Japan, India, New Zealand, Malaysia, Turkey, Hungary, and Thailand. The FOMC announcement on Wednesday will be followed by a press conference with Chairman Bernanke. Minutes of this month’s Bank of England meeting will be also published on Wednesday. The Bank of […] More
Foreign Exchange Insights and Next Week
Euro’s Fate Next Week Hinging on PSI Deal
January 20, 2012
At this moment, reports leaking out of the PSI talks between Greece and its private sector creditors suggest that prospects have improved for a deal before the end of this weekend. PSI is the acronym for "private sector involvement," which in turn euphemistically refers to a voluntary exchange of existing Greek debt for new instruments […] More
New Overnight Developments Abroad - Daily Update
Hopeful Week Ending on Cautious Note
January 20, 2012
A dip in risk appetite can be seen in rise of dollar and lower commodities and European equities. The German Dax and Paris Cac have fallen 0.5% and 0.6% from multi-month highs. The dollar has advanced 0.4% against the euro and Swiss franc and is up 0.2% against the Australian and Canadian dollars as well […] More
