Deeper Analysis
August in Figures
August 31, 2013
August was a difficult month for equities and for U.S. and European sovereign debt. Central bank leaders failed to convince markets that a change in quantitative monetary easing wouldn’t constitute a shift in overall monetary policy for the simple reason that it isn’t so. Dollar/yen experienced only a minuscule net change in August, and JGB […] More
Foreign Exchange Insights and Next Week
Next Week
August 30, 2013
The main G20 event of 2013, the annual summit of Group of Twenty leaders, takes place in Saint Petersburg, Russia, on September 5-6. That means the United States will likely attack Syria no later than Wednesday, because it’s easier to apologize for ignoring world opinion after the fact that to go to the conference trying […] More
New Overnight Developments Abroad - Daily Update
A Sea of Data Fails to Stir the Dollar
August 30, 2013
The dollar is unchanged against the euro, kiwi, yuan and sterling and down just 0.1% versus the yen, loonie, Australian dollar and Swiss franc. The big overnight news was a vote by Britain’s House of Commons not to participate in a military strike on Assad’s forces in Syria. This has made the U.S. response and […] More
Foreign Exchange Insights and Next Week
Goodbye to a Thought-Provoking Summer
August 29, 2013
Dollar movements against the yen, euro, Swiss franc, and sterling between the U.S. Memorial Day and Labor Day weekends were no greater than 3.0%. In each of the instances, the dollar lost ground. Although it did well in the final week of summer, it seems premature to characterize such gains as anything more than noise. […] More
Central Bank Watch
Bank Indonesia Makes an Unscheduled Tightening of Policy
August 29, 2013
Two weeks after a scheduled meeting that left the key BI policy rate at 6.5%, the Board of Governors convened for an unscheduled meeting, after which a package of measures including a BI rate hike to 7.0%, a 50-basis point deposit rate hike to 5.25%, and a 25-bp lending rate increase to 7.0% was revealed. […] More
Central Bank Watch
Central Bank of Brazil Lifts Selic Rate Further
August 29, 2013
In a nearly universally expected move, Brazil’s monetary policy committee, Copom, increased the Selic interest rate to 9.0% from 8.5%. The cumulative move over the past four months has been an advance of 175 basis points through increments of 25 bps in April and 50 bps each in May, July and now August. A released […] More
New Overnight Developments Abroad - Daily Update
Firmer Dollar
August 29, 2013
The dollar has benefited from the lessening imminence of U.S./UN military action against Syria. The greenback rose overnight by 0.8% against the Swiss franc, 0.6% versus the euro, 0.5% relative to the yen, 0.2% vis-a-vis the kiwi and loonie, and 0.1% against the Australian dollar and sterling. The yuan is steady. There were some sizable […] More
New Overnight Developments Abroad - Daily Update
UN/U.S. Missile Strike in Syria Appears Just a couple Days Away
August 28, 2013
Markets continue to be rattled by the additional uncertainty of what escalating western military involvement in Syria will cause. Although opinion polls show four in five Americans opposed to military retaliation, a missile attack by Thursday is believed likely. Share prices fell 3.0% in the Philippines, 2.5% in Vietnam, 1.6% in Hong Kong, 1.5% in […] More
Central Bank Watch
A Modest Tapering of the Downtrend in Hungary’s Central Bank Interest Rate
August 27, 2013
The Monetary Council at Magyar Nemzeti Bank decided to cut the two-week deposit rate by 20 basis points to 3.8%. Twelve consecutive monthly 25-basis point reductions had preceded this action. Incoming data on inflation and the real economy give scope to ease monetary conditions further. However, in light of the significant reduction in interest rates […] More
New Overnight Developments Abroad - Daily Update
Geopolitical Market Havoc
August 27, 2013
The Middle East again is holding the rest of the world hostage, as the U.S. feels compelled to respond to Syria’s alleged use of chemical weapons against its own citizens. Commodities have spike 1.4% in the case of gold to $1412.0 per ounce and 1.2% in the case of WTI crude oil to $107.21 per […] More
