Central Bank Watch
Bank Indonesia BI Rate Left Unchanged
June 12, 2014
The BI central bank interest rate has been 7.5% since a 25-basis point hike last November. The level had previously not been so high since April 2009, and today’s statement affirmed the view that policy is consistent with attaining inflation objectives and a shrinking the current account deficit. A four-year low in Indonesia’s economic growth […] More
Central Bank Watch
Bank of Korea Retains 2.5% Key Interest Rate
June 12, 2014
Three 25-basis point cuts of the South Korean seven-day repo rate implemented in July 2012, October 2012 and May 2013 constitute the last changes in monetary policy. Thirteen monthly meetings subsequently have ended with essentially the same message that South Korea’s output gap will stay negative, although narrowing gradually, for the time being and that […] More
Central Bank Watch
Third Interest Rate Hike since March by Reserve Bank of New Zealand
June 12, 2014
In a widely expected move, New Zealand’s Official Cash Rate was lifted from 3.0% to 3.25%. Similar moves were also announced on March 15 and April 24. In light of a stronger-than-desired exchange rate, it was thought, however, that the accompanying remarks by Governor Wheeler might signal a pause in tightening, but that was not […] More
Foreign Exchange Insights and Next Week
What Divergent Monetary Policy Biases Suggest…. Or So We’re Told
June 12, 2014
Students are taught that unsynchronized monetary policies promote currency volatility. For bored currency market watchers, it ought to be heartening to see significant divergences among the major central bank policy biases for the first time since the European Central Bank raised interest rates in July 2008. Now it is the ECB whose stance is most […] More
New Overnight Developments Abroad - Daily Update
Kiwi Jumps Over 1% After New Zealand Official Cash Rate Hike
June 12, 2014
The New Zealand dollar advanced 1.4% net against its U.S. counterpart and got as strong as USD 0.8690 following the Reserve Bank of New Zealand’s scheduled monetary policy meeting. While a third 25-basis point tightening since March had been anticipated, investors reacted most to the accompanying guidance that points to greater-than-assumed further tightening in the […] More
