New Overnight Developments Abroad - Daily Update
Crimea, Missing Malaysian Flight, and Lower Euro Area Inflation Top News
March 17, 2014
Over 95% of voting Crimeans signal desire to leave Ukraine. Crimean parliament requests annexation by Russia. Russian lawmakers to decide whether to do such. Obama calls vote unlawful and threatens economic sanctions. Malaysian Airlines Flight 370’s whereabouts still unknown, but best guess is in one of the deepest parts of the Indian Ocean. Evidence now […] More
Foreign Exchange Insights and Next Week
Next Week
March 14, 2014
An interesting week lies ahead, starting with Sunday’s referendum in Crimea that is highly likely to approve discarding Ukraine sovereignty. What Russia then does may dictate the tone of the week. two special events on Wednesday will be the annual budget speech in Britain presented by Chancellor of the Exchequer Osborne and the FOMC meeting, […] More
Central Bank Watch
Bank of Russia Signals No Early Reduction of Elevated Interest Rate
March 14, 2014
In an emergency meeting on March 3rd, Bank Rossii officials raised the Russian one-week repo rate by 150 basis points to 7.0%. Although today’s scheduled meeting did not tighten the policy stance additionally, it explained that a near-term cut is not going to happen. High inflation risks that brought about an increase in the key […] More
New Overnight Developments Abroad - Daily Update
Crimean Secession Vote Sunday Overshadows Marketplace
March 14, 2014
Japan’s Nikkei-225 plunged 488 points or 3.3% to a one month low. Rampant risk aversion also lifted the yen by a further 0.5% to 101.27 per dollar. In other bourses, share prices fell 1.5% in Australia, 1.0% in Hong Kong, 0.8% in South Korea and China, 0.7% in Taiwan, and 0.6% in New Zealand. In […] More
Central Bank Watch
Peruvian Central Bank Reference Interest Rate Kept at 4.0%
March 13, 2014
There was a 25-basis point reduction of Peru’s central bank policy interest rate in November to 4.0%, the first change in 47 months, but it will continue to stay at that level. Supply-side factors, as in Chile, lifted Peruvian CPI inflation during February, but that shock is projected to fade. Officials expect inflation to settle […] More
Central Bank Watch
Another Chilean Interest Rate Cut Despite Higher Inflation
March 13, 2014
The Chilean monetary policy rate was sliced by 25 basis points to 4.0%. Similar-sized reductions were made last month, in November and October 2013, and January of 2012. A statement from the central bank Board discusses both a loss of economic strength recently and rise of inflation in February, the latter caused by peso depreciation […] More
Foreign Exchange Insights and Next Week
Euro Badlands
March 13, 2014
The euro area economy needs a strong and strengthening euro like a hole in the head. Three straight quarters of positive but sluggish expansion has lifted GDP for the whole region to a mere 0.5% above its year-earlier level, and the shortfall from the pre-Great Recession peak is even greater. Germany’s on-year growth of 1.4% […] More
Central Bank Watch
Indonesian BI Interest Rate Left Unchanged at 7.5%
March 13, 2014
A statement released after the Bank Indonesia monthly Board meeting cites positive results — falling inflation, more balanced growth, a narrower current account deficit, and rupiah appreciation that has reduced last year’s steep fall in the exchange rate’s value — from a string of interest rate hikes but promises continuing monetary policy vigilance going forward. […] More
Central Bank Watch
Bank of Korea Keeps 2.5% Seven-Day Repo Rate
March 13, 2014
No interest rate change was made at the last monthly policy meeting presided over by the outgoing Bank of Korea governor. The benchmark rate has been 2.5% since a 25-basis point cut in May, which was the third such move since July 2012. Previously the rate was raised from 2.0% before June 2010 to 3.25% […] More
New Overnight Developments Abroad - Daily Update
New Zealand Interest Rate Hike and Soft Chinese Data
March 13, 2014
New Zealand became the first advanced economy to lift its benchmark interest rate. The central bank, RBNZ, raised the Official Cash Rate to 2.75% from 2.5% and signaled that more increases will be forthcoming over the coming two years. The action sent the kiwi to a new trade-weighted high. Chinese industrial production growth in January-February […] More
