Foreign Exchange Insights and Next Week
The Race for Weaker Currencies
November 7, 2013
Comparisons to conditions during the Great Depression were made often back in 2008 and 2009, less so for a couple of years thereafter, but are popping up again. One of the notable dissimilarities at first concerned commercial policy in the two periods. Beggar-thy-neighbor tactics were common in the 1930s. Saddled with anemic domestic demand, governments […] More
Central Bank Watch
Czech National Bank
November 7, 2013
As in Hong Kong, Singapore, and Switzerland, Czech monetary policy henceforth will be subordinated to an exchange rate policy mandate. Some central banks like the Fed, Bank of Japan, and Bank of England have used asset buying to stimulate monetary policy once their interest rates are virtually at zero. Monetary officials in the Czech Republic […] More
Central Bank Watch
Bank Negara Malaysia
November 7, 2013
The overnight Malaysian policy interest rate has been 3.0% since a 25-basis point hike in May 2011 that culminated four such increases implemented in March 2010, May 2010, July 2010 and the aforementioned most recent tightening. A statement from the Monetary Policy Committee at BNM projects higher inflation than the 1.8% on-year average in the […] More
Central Bank Watch
The ECB’s Surprise Rate Cut
November 7, 2013
In a surprise to private ECB watchers, the Governing Council cut both the refinancing rate and the marginal lending rate to 0.25% and 0.75%, respectively, while leaving its deposit rate at zero. At today’s press conference, President Draghi denied that the decision was a response to the euro’s external level, asserting that policymakers acted in […] More
Central Bank Watch
Bank of England
November 7, 2013
The Monetary Policy Committee did not change its two policy settings — a 0.5% key interest rate and a GBP 375 billion ceiling on the asset purchase program — were left unchanged as expected. Forward guidance unveiled last July remains intact and factored in today’s result. A statement shed no light on the committee’s latest […] More
New Overnight Developments Abroad - Daily Update
ECB Cuts Interest Rates, Surprising Analysts Who Didn’t Expect Such Before December.
November 7, 2013
The dollar has marked time overnight and on balance is unchanged against the euro, yen and kiwi, up 0.1% versus sterling and the Swiss franc, up 0.3% relative to the Aussie dollar, and down 0.1% vis-a-vis the loonie. Share prices dropped 0.8% in Japan, 0.6% in China and the Philippines, 0.7% in Hong Kong, 0.4% […] More
