Archive for December 2012

New Overnight Developments Abroad - Daily Update

Lots of Japanese Data and Disappointing Retail PMI Scores

December 28, 2012

The dollar extended its 28-month high against the yen to 86.65.  The greenback shows net overnight gains of 0.4% against the euro and Swissie and of 0.1% relative to the yen, kiwi, and sterling.  The loonie and Aussie dollar are steady.  The yuan is 0.2 higher. Stocks climbed in the Pacific Rim but are lower […] More

New Overnight Developments Abroad - Daily Update

Focus Returns to Fiscal Cliff Negotiations

December 27, 2012

European markets reopened after the Christmas recess.  Obama is back from Hawaii, and Congress resumes fiscal cliff talks today.  There’s no hope of a “grand bargain.”  Analysts are instead looking for some kind of short-term truce to buy time in January, but so far, neither House Republicans nor the Democrats show a predisposition to compromise […] More

Deeper Analysis

Trade-Weighted Movements in the Dollar, Euro, Pound and Yen

December 26, 2012

Using period averages, I compared trade-weighted currency indices this month to December 2011, December 2007 and December 2002 to gauge how the dollar, euro, sterling and yen had changed value over the past year, past five years, and past ten years. Net change in the U.S. dollar amounted to less than 1.0% since end-2011 and […] More

New Overnight Developments Abroad - Daily Update

Falling Yen Trend Extended

December 26, 2012

Much of Europe remains shut for holiday, including Britain, Switzerland, Germany, Italy and Greece.  Canada, New Zealand and Australia are also closed for Boxing Day. There were a number of Japanese developments. Shinzo Abe was chosen prime minister by the newly elected parliaments.  Since Koizumi, who served several years through September 2006, Japan has had […] More

Central Bank Watch

Israeli Interest Rate Reduction

December 25, 2012

The Bank of Israel’s benchmark policy interest rate was cut Money to 1.75% from 2.0%.  Analysts had been split over whether another cut would be implemented or if, as in November, policymakers would choose to change their interest rate.  This was the sixth rate reduction of the cycle.  Earlier moves, all by 25 basis points, […] More

New Overnight Developments Abroad - Daily Update

Christmas Break

December 25, 2012

Financial markets are closed today throughout Europe and in the United States, Canada, Australia and New Zealand.  The most notable exception was Japan, which opened after a three-day weekend observing the Emperor’s birthday.  Many places will stay shut for Boxing Day tomorrow, such as Britain, Hong Kong, Australia, Canada, Greece and Italy. In Japan, an […] More

New Overnight Developments Abroad - Daily Update

Nothing Meaningful to Report this Day Before Xmas

December 24, 2012

Most markets were either closed or closed early this Christmas Eve.  The U.S. Congress will return on Thursday. Japan observed the Emperor’s Birthday holiday. The dollar and yen are a little softer.  The U.S. currency edged up 0.2% against the yen but is down 0.4% relative to the euro, 0.3% versus the Swiss franc, 0.2% […] More

Foreign Exchange Insights and Next Week

Next Week

December 23, 2012

The week of Christmas has a short list of economic data releases and no major scheduled central bank meetings. Japan is the only G7 economy not to celebrate the holiday.  Instead, the Emperor’s Birthday holiday will be observed on Monday. Japan is also the only major economy to be releasing several important indicators: corporate service […] More

New Overnight Developments Abroad - Daily Update

Old Worries Return

December 20, 2012

Fiscal cliff talks appear to have bogged down. Greek Finance Minister Stournaras said a Greek departure from the euro zone remains possible and called 2013 a make or break year. Weak revenue growth in Australia led Treasurer Swan to back away from forecasting a budget surplus this fiscal year.  There were other signs of general […] More

Central Bank Watch

Norges Bank Leaves Key Policy Interest Rate at 1.5% in Norway

December 19, 2012

Norges Bank in October 2009 became the first European central bank to hike its policy interest rate following the Great Recession.  Thanks to cuts of 50 basis points a year ago and a further 25 bps in March 2008, however, the current 1.5% level is on net only 25 basis points above the 2009 trough […] More