Deeper Analysis
GDP and Other U.S. Economic Indicators Reported Today
December 23, 2014
The initial preliminary estimate of third-quarter GDP put quarterly growth at a seasonally adjusted annualized rate of 3.5%. That calculation got revised upward to 4.6% a month ago and an 11-year high of 5.0% today. Between the first estimate and today’s second revision, growth in real personal consumption got revised from 1.8% to 3.2%, and […] More
New Overnight Developments Abroad - Daily Update
Awaiting Several U.S. Data Releases Today Before the Xmas Break
December 23, 2014
The U.S. data release calendar today encompasses the final estimate of 3Q GDP plus monthly personal income and spending, durable goods orders, new home prices, the FHFA house price index, the Richmond Fed manufacturing index, and the Reuters/U. Michigan consumer sentiment index. Weekly chain store sales also get reported. In the meantime, the release of […] More
New Overnight Developments Abroad - Daily Update
Slow But Constructively Solid Start to Week of Christmas 2014
December 22, 2014
Last week’s post-FOMC rally in share prices remained intact in Asian and European trading. Stocks rose 1.9% in Australia, 1.3% in Hong Kong, 1.2% in India, 1.6% in Singapore, and 1.1% in Taiwan. Lesser gains were achieved in South Korea of 0.7%, China of 0.3%, and Japan of 0.1%, but equities in Europe so far […] More
Foreign Exchange Insights and Next Week
Next Week
December 19, 2014
Holiday closures dominate the week ahead. Japan will be closed for the Emperor’s birthday on Tuesday but then one of the few markets open for the remainder of the week. Most markets will be Thursday for Christmas, and many stay shut Friday for Boxing Day or Saint Stephen’s Day. Among key central banks, only Turkey […] More
Central Bank Watch
Bank of Japan Board Keeps Settings and Upgrades Assessment
December 19, 2014
After meeting for five hours 51 minutes on Thursday and Friday, the BOJ retained the augmented quantitative stimulus guidelines agreed by an 8-1 vote at its October 31 meeting. Takahide Kiuchi dissented again, as he favors reverting back to the less aggressive stimulus settings before October 31. Somewhat surprisingly, the Board’s economic assessment was upgraded, […] More
New Overnight Developments Abroad - Daily Update
Weaker Yen and European Stocks, Stronger Asian Equities, and Firmer Oil
December 19, 2014
A volatile week in the marketplace has seen more swings on Friday, but dollar movement against the majors has been less than 0.3% except for a 0.4% drop in the yen. Share prices in the Pacific Basin advanced by 2.5% in Australia, 2.4% in Japan, 1.7% in South Korea, 1.3% in Hong Kong, 1.1% in […] More
Central Bank Watch
Swiss National Bank Re-introduces a Negative Interest Rate
December 18, 2014
Just a week after a quarterly Swiss monetary policy review that left settings unchanged, Swiss authorities in an unscheduled action adopted a negative 0.25% sight deposit rate, versus zero before, and changed the targeted 3-month Swiss Libor target to -0.75% to +0.25%. The range previously had been 0-0.25% since August 11, 2011, and a one-sided […] More
Central Bank Watch
Taiwanese Central Bank Interest Rates Left Unchanged
December 18, 2014
The discount rate at the Central Bank of The Republic of China has been at 1.875% since five successive 12.5-basis point hikes between June 2010 and June 2011 raised such from a prior 56-year low of 1.25%. The fourteen ensuing quarterly policy reviews have left the rate unchanged, including today’s. A released statement after this […] More
New Overnight Developments Abroad - Daily Update
Fresh Distractions
December 18, 2014
The Yellen press conference gave reassurance to a market unsure of the direction of Fed policy, and it triggered strong gains in stocks and the dollar plus a rebound in long-term interest rates. But now the market has moved on to new distractions. The Swiss National Bank at an unscheduled meeting and just a week […] More
Deeper Analysis
FOMC Statement: Some Observations
December 17, 2014
The statement released after the FOMC’s eighth and final meeting of 2014 expressed more optimism in labor market trends, deleting the qualifying adjective “somewhat” from improving labor market conditions and replacing “gradually diminishing” with “continues to diminish” in the comment about underutilization of labor resources. Sub-target inflation attributed only “partly” to declining energy prices, meaning […] More
