Archive for April 2016

New Overnight Developments Abroad - Daily Update

A Focus on Central Banks, Commodities and China

April 21, 2016

The ECB just announced  decisions from today’s third Governing Council meeting of the year.  No further rate changes were enacted.  At the prior meeting on March 10, the refinancing rate was sliced 5 basis points to 0.0%, the deposit rate was moved 10 basis points more deeply into the red to -0.40%, and the marginal […] More

Central Bank Watch

Central Bank of the Republic of Turkey

April 20, 2016

The monetary policy committee announced a follow-up reduction of its overnight lending rate, this time of 50 basis points to 10.0%.  As in March when such was lowered by 25 basis point, the other two central bank interest rates — a 7.5% one-week repo rate and a 7.25% overnight borrowing rate were not changed.  The […] More

Deeper Analysis

First Quarter U.S. GDP Growth

April 20, 2016

The earliest estimate by the Bureau of Economic Analysis of U.S. real GDP last quarter is scheduled to be released a week from tomorrow on April 28.  Other released data point to very weak growth, with a reasonable probability of a figure below 0.5% at a seasonal adjusted annualized rate (saar) and a chance even […] More

New Overnight Developments Abroad - Daily Update

Dollar Little Affected by Risk Aversion in Other Markets

April 20, 2016

Stocks in China, Hong Kong and Taiwan slumped 2.3%, 1.5%, and 1.4%.  A Chinese central bank official implied lessening inclination to ease. West Texas Intermediate crude oil dropped 2.3% to $40.14 per barrel on news that Kuwaiti workers called off their strike. The 10-year Japanese JGB yield dipped another basis point to a record low […] More

Foreign Exchange Insights and Next Week

Currency Outlook Highly Dependent on Price of Oil

April 19, 2016

Juxtaposed against rising oil prices, the dollar has depreciated around 2.5% on a trade-weighted basis over the past month.  The U.S. currency has declined by similar percentages against the yen, loonie, and Australian dollar and even more sharply versus the kiwi.  Smaller drops of roughly 1% occurred against the euro and Swiss franc.  A major […] More

Central Bank Watch

Bank of Korea

April 19, 2016

A 1.5% seven-day repo rate was retained yet again.  In the Great Recession, the rate was lowered to 2.0% but raised subsequently to 3.0% by July 2010.  The last six changes were all cuts of 25 basis points spaced between November 2012 and June 2015.  The last of these was decided by a unanimous vote.  […] More

New Overnight Developments Abroad - Daily Update

Investors React to a Batch of Good News

April 19, 2016

Investors are feeling better about U.S. corporate earnings and the chances that China’s economy will avoid a hard landing. The Bank of Korea did not cut its interest rate, and minutes from the early April Reserve Bank of Australia Board meeting showed no rush to ease, either. Sentiment toward Germany and Euroland improved much more […] More

New Overnight Developments Abroad - Daily Update

Oil Talks Collapse and a Brazilian Vote to Impeach President Rousseff

April 18, 2016

Oil ministers from OPEC and Non-OPEC producers did not agree to freeze production at January levels.  Iran didn’t join the meeting, and Saudi Arabia refused to adopt any accord without Iranian participation.  Hopes for an agreement had previously lifted oil by more than 60% from a 12-year low of $26.05 on February 11 to over […] More

Deeper Analysis

G20 Finance Ministers and Central Bank Governors Say This about Currencies

April 16, 2016

A statement issued by G20 finance ministers and central bank governors after a two-day meeting in Washington contained this passage regarding currencies and what role governments might play in their determination.  The comments are consistent with what officials have been saying for many years.  Currency manipulation is considered a form of protectionism, but a role […] More

Foreign Exchange Insights and Next Week

Next Week

April 15, 2016

Central Banks:  Interest rate policy meetings at the ECB and in South Korea, Indonesia, Turkey, Sweden and Ukraine.  The Reserve Bank of Australia releases minutes from its meeting earlier in April.  N.Y. and Boston Fed Presidents Dudley and Rosengren speak publicly.  So do Reserve Bank of Australia Governor Stevens and ECB President Draghi. Events:  World […] More

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