Central Bank Watch
Central Bank of the Republic of Colombia Again Keeps Key Interest Rate Unchanged
February 28, 2014
The last change in Colombia’s main central bank lending rate was a 50-basis point cut on March 22, 2013 that culminated a string of seven reduction beginning in July 2012 and cumulating to 200 basis points. Previously, the rate was raised by 225 basis points between July 2011 and July 2012. Colombian CPI inflation stood […] More
Deeper Analysis
February in Figures
February 28, 2014
February was a very different month from January in several market respects. In January, the dollar mostly rose, while equities declined for the most part. Both trends reversed in February. Net movement in ten-year sovereign debt yields this past month were insignificant is size in contrast to their substantial declines in January. West Texas Intermediate […] More
Foreign Exchange Insights and Next Week
Next Week
February 28, 2014
It’s PMI week. Manufacturing purchasing manager surveys will be released for China, Australia, Spain, Switzerland, France, Italy, Germany, Euroland, Greece, the Netherlands, Russia, Britain, the United States, South Korea, Taiwan, Vietnam, Indonesia, India, Ireland, Poland, Turkey, the Czech Republic, Canada, Mexico, Sweden, Denmark, Singapore, Norway, South Africa and Hungary. Private PMI’s arrive for Hong Kong, […] More
Deeper Analysis
U.S. and Canadian Fourth-Quarter 2013 GDP Growth
February 28, 2014
U.S. real GDP grew 11% in the 4.5-year-long recovery but just 6.2% since the last business cycle peak in 4Q07. That works out to a 1.0% per year rate of expansion over the last six years. Although measuring the discrepancy between actual GDP and potential GDP is fraught with error, it’s quite clear that the […] More
New Overnight Developments Abroad - Daily Update
Ton of Released Data, Some with Unexpected Results
February 28, 2014
The yuan suffered its greatest single-day drop in almost seven years and hit a 10-month low against the dollar. Yesterday’s testimony by Fed Chairwoman Yellen was somewhat more dovish than anticipated. The dollar is down 0.8% against the Swiss franc and 0.6% weaker versus the euro after touching a 2014 low of $1.3814 earlier in […] More
Foreign Exchange Insights and Next Week
Major Dollar Relationships in Mark Time March Mode
February 27, 2014
It hasn’t been an exciting January and February for dollar watchers. The key EUR/USD pair has traded in a 2.3% high-low band between $1.378 and $1.347 so far this year and shows no net change in the latest Thursday-to-Thursday period. In this statement week, the dollar has edged down 0.2% against the yen, Swiss franc, […] More
New Overnight Developments Abroad - Daily Update
Geopolitical Tensions Intensify Market Fear of Risk
February 27, 2014
Escalating tension within Ukraine between those loyal to Russia and those seeking closer ties with Europe sent the hyrvnia tumbling some 10% to 11.2/USD. Global financial markets have been infected, with sovereign debt yields and equities falling but the yen and dollar rising. Stocks in Europe have declined by 1.5% in Germany, 1.3% in Spain, […] More
Central Bank Watch
Brazilian Selic Rate Hiked by 25 Basis Points to 10.75%
February 26, 2014
Brazil’s monetary policy committee, known as Copom lifted the Selic interest rate late on February 26 to 10.75% from 10.50%. The unanimous decision reduced in half the size of prior tightening moves made in January, November, October, August, July and May. An initial increase in April 2013 had also been 25 bps in size from […] More
Deeper Analysis
It Was Twenty-Nine Years Ago Today
February 26, 2014
The U.S. currency recorded its strongest level of the floating dollar rate era on February 26, 1985 after a highly speculative run-up in the first two months of the year. That day marked the last hurrah of early 80s upswing. From a low of DEM 1.7000 at the start of 1980, for instance, the dollar […] More
New Overnight Developments Abroad - Daily Update
Fresh Declines in Ukraine and Russian Currencies
February 26, 2014
Overnight dollar movements have been limited to gains of 0.2% against the yen and Aussie dollar and of 0.1% relative to the Swiss franc, offset by 0.1% dips against the kiwi, loonie and sterling. The dollar is unchanged against the yuan and euro. A follow-up Ukraine hryvnia devaluation to that announced February 6 has been […] More
