Foreign Exchange Insights and Next Week
Market Volatility Fueled by Factors that Are Somewhat Inconsistent with One Another
June 13, 2013
It’s been a very volatile statement week through Thursday for bonds, stocks, and certain currency relationships like dollar/yen, NZD/USD, and AUD/USD, all of which traded in a high-low band today of 2.7-2.4% in width. Unlike most of the the time since 2007, bonds and stocks have traded the same way. They and commodity prices have […] More
Central Bank Watch
Bank Indonesia
June 13, 2013
A day after raising the overnight deposit rate to 4.25% from 4.0%, officials at Indonesia’s central bank took the more significant step of also lifting the main Bank Indonesia Rate to 6.0% from 5.75%, its level since a 25-basis point cut in February 2012. That reduction had been the third one in a span of […] More
Central Bank Watch
Filipino Monetary Policy
June 13, 2013
Officials at this year’s fourth interest rate policy meeting voted to leave the overnight borrowing and lending rates at 3.5% and 5.5%, respectively, and did not cut the Special Deposit Rate any further. Such was sliced on January 24, March 13, and April 25 to the current 2.0% level, and policymakers are pausing to assess […] More
Central Bank Watch
Bank of Korea: No Interest Rate Change this Time
June 13, 2013
Officials at the Bank of Korea voted unanimously to retain a 2.5% seven-day repo rate this month. There had been three cuts of 25 basis points since mid-2012, most recently last month. A statement from the central bank calls the pace of economic growth weak and predicts “a negative output gap for a considerable time, […] More
Central Bank Watch
New Zealand Monetary Policy Announcement
June 13, 2013
We expect to keep the OCR unchanged through the end of the year. So concludes the latest statement on monetary policy from the Reserve Bank of New Zealand. The Official Cash Rate has been at 2.5% since a 50-basis point cut in March 2011 that was implemented soon after a devastating earthquake on the South […] More
New Overnight Developments Abroad - Daily Update
Imploding Confidence in Japanese Abenomics Infecting Other Global Markets
June 13, 2013
Amid huge doubts that meaningful deregulation will be implemented by Japan’s new LDP government, the Nikkei plunged another 6.4% overnight, and the yen touched a two-month high of 93.78/USD. Since May 22, the Nikkei has lost 20.3%, and yen has recouped 10.6% versus the dollar. Other Asian stock markets dived by 3.4% in China (following […] More
