Deeper Analysis
October in Figures
October 31, 2013
Share prices strengthened in October with the notable exception of Japan. Long-term interest rates subsided further, while short-term rates remained steady and well below the long rates. The dollar closed narrowly mixed, and gold posted a minuscule dip. Oil prices fell around 6% and swung back below $100 per barrel. 10-Yr Yield 09/30/13 10/31/13 Chg […] More
Foreign Exchange Insights and Next Week
In the Eye of the Storm
October 31, 2013
Could it be that this is the eye of a market storm? To the rear lies the worst accident to GDP and employment growth since the 1930s, an event from which advanced economies never fully recovered. Lately, emerging nations like India seem under the weather, but economic prospects for the most part appear constructive. Assumptions […] More
Central Bank Watch
BOJ Meeting and Semi-Annual Report
October 31, 2013
An An abbreviated statement was released following the Bank of Japan Board’s second meeting in October at which officials agreed to stay the course of a policy of quantitative and qualitative easing that was launched almost seven months earlier with the purpose of doubling the monetary base by March 2015 and raising such a a […] More
New Overnight Developments Abroad - Daily Update
Stocks Soften in the Pacific Rim after FOMC and RBNZ Statements
October 31, 2013
Share prices fell 1.4% in China, South Korea and Indonesia. Japan’s Nikkei lost 1.2% on the final day of October, and equities slipped 0.6% in Singapore and Malaysia, 0.4% in Hong Kong, 0.2% in Taiwan and 0.1% in Australia. In Europe, the British Ftse and German Dax show losses of 0.5% and 0.2%, while stocks […] More
Central Bank Watch
New Zealand OCR Left Unchanged at 2.5%
October 30, 2013
As analysts, the Reserve Bank of New Zealand policymakers led by Governor Wheeler kept the Official Cash Rate at 2.5%, its level since March 2011. A released statement reiterated that “increases will likely be required next year.” GDP advanced more than 3.0% over the past year led by consumption and construction, and on-year CPI inflation […] More
Central Bank Watch
Reserve Bank of India
October 30, 2013
Tuesday’s meeting ended with an announced hike of India’s repo rate to 7.75% and reverse repo to 6.75%. Similarly sized hikes were done on September 20th. At the same time, the marginal standing facility rate was cut 25 bps to 8.75%. These changes restore operational responsibility for monetary policy to the repo and reverse repo […] More
Central Bank Watch
FOMC Statement Doesn’t Rock the Boat
October 30, 2013
Today’s statement from the FOMC announces no changes in policy settings and the same forward guidance as before. One finds in the document very few modifications from the previous statement released September 18. Here are four. The word “generally” has been added to the assertion that information since the prior meeting suggests economic activity has […] More
Central Bank Watch
FOMC Encore
October 30, 2013
The previous FOMC meeting in mid-September produced one of the least expected results in memory. Forward policy guidance now constitutes a centerpiece of U.S. monetary policy, and officials from Chairman Bernanke downward had seemingly been preparing markets for a reduction of quantitative stimulus beginning in September. There had been no verbal signals just before that […] More
Central Bank Watch
Another Cut Implemented in Hungary’s Two-Week Repo Rate
October 30, 2013
The policy interest rate of Magyar Nemzeti Bank had been reduced by 25 basis points for twelve straight months through July 2013 and now by a further 20 basis points each in the ensuing three months. The rate now becomes 3.40%, down from 7.0% prior to August 2012. A statement from officials defends this progressively […] More
Central Bank Watch
Bank of Israel: No Rate Cut this Month
October 30, 2013
In a statement released Monday, Bank of Israel policymakers noted that the shekel had stopped appreciating and instead eased over the past month. For this reason and a few others — in-target inflation over the past twelve months, expected in-target inflation over the coming year, reduced interest rate yields with those in advanced economies, and […] More
