Foreign Exchange Insights and Next Week
A Dull Quarter in Foreign Exchange
March 27, 2014
Many interesting things developed in the first quarter of 2014. A changing of the guard at the helm of the Federal Reserve for the first time in eight years was accompanied by new forward guidance and the hint of a sooner first interest rate hike than markets were assuming. Unusual weather patterns won over new […] More
Central Bank Watch
South African Reserve Bank
March 27, 2014
The South African Reserve Bank embarked on a tightening interest rate cycle in January, raising its repo rate to 5.5% from a 42-year low of 5.0% in place since July 2012. Although today’s meeting failed to increase the repo rate further, officials said that more increases would follow but that the tightening path will not […] More
Central Bank Watch
Bangko Sentral ng Pilipinas Hikes its Reserve Requirement Ratio
March 27, 2014
Although the Filipino overnight lending and borrowing rates were left at 5.5% and 3.5% as expected, the reserve ratio was tightened to 19% from 18%. Interest rates were cut four times, each by 25 basis points, during 2012 but not subsequently, and this was the first reserve ratio change since a cut 25 months ago. […] More
Central Bank Watch
Czech National Bank
March 27, 2014
The two-week Czech repo rate was last cut in November 2012. That reduction was 20 basis points in size and left the Czech Republic with a virtual zero interest rate policy (the rate has been at 0.05% ever since). To prevent tighter monetary conditions caused by deflation, an additional exchange rate monetary tool was introduced […] More
Central Bank Watch
Norges Bank
March 27, 2014
The Executive Board of Norway’s central bank chose to retain the overnight deposit rate at 1.5%, its level since cuts of 50 basis points in December 2011 and a follow-up 25 basis points in March 2012. Moreover, a released statement included forward guidance that the key interest rate will likely not be raised until the […] More
Central Bank Watch
Central Bank of the Republic of China (Taiwan) Calls Existing Policy Settings Appropriate
March 27, 2014
Monetary policy in Taiwan is reviewed quarterly. The discount rate was cut at five sequential meetings from June 2010 to June 2011, each time by 12.5 basis points, but the end-point of that streak, 1.875%, has been retained since June 2011 and will continue over the coming three months. Taiwan’s central bank statement projects moderate […] More
New Overnight Developments Abroad - Daily Update
Kiwi Climbs 0.8% against USD to 29-Month High of $0.8682
March 27, 2014
The U.S. dollar also slipped overnight by 0.2% against sterling and 0.1% versus the loonie but has advanced by 0.3% against the euro and Swiss franc, 0.2% relative to the yen and 0.1% versus the yuan. The Aussie dollar touched a four-month high of USD 0.9246 but is currently unchanged on balance. Trading yesterday afternoon […] More
