Central Bank Watch
Malaysia’s First Rate Cut Since Early 2009
July 13, 2016
Warning that ” the uncertainties in the global environment could weigh on Malaysia’s growth prospects,” a statement released by the Monetary Policy Committee of Bank Negara Malaysia justifies a 25-basis point interest rate cut to 3.0%. External downside growth risks look greater: “Global growth prospects have become more susceptible to increased downside risks in light […] More
New Overnight Developments Abroad - Daily Update
A Broadening Sense of Relief
July 13, 2016
Global stocks recorded a fifth straight session of appreciation. Industrial commodities continued to rally as well. The dollar is marginally softer. Investors are relieved that the succession of British governments is occurring more quickly than feared and feel confident that Theresa May is the right person to lead the U.K. through its exit from the […] More
New Overnight Developments Abroad - Daily Update
Markets Moved Sharply by Politics and the Comments of Officials
July 12, 2016
Three developments cheered markets, which chose to look at good developments rather than the still-tense racial tensions in the United States: Pieces are falling quickly into place for the U.K. to get a new prime minister, Theresa May. In parliamentary testimony, Bank of England Governor Carney hinted that more stimulus will be forthcoming to counter […] More
New Overnight Developments Abroad - Daily Update
Sharply Weaker Yen
July 11, 2016
The yen lost 2.1% against the dollar, notching its biggest daily decline in 11-1/2 weeks. There has not been reported intervention, but Sunday’s upper house parliamentary election, won strongly by Prime Minister Abe’s LDP Party, clears the way for more aggressive macroeconomic stimulus there. Half of the 242 seats in Japan’s House of Councillors were […] More
Foreign Exchange Insights and Next Week
Next Week
July 8, 2016
Election: Half of Japan’s upper parliamentary house, 121 seats, will be selected on Sunday. The LDP is expected to win big and perhaps secure a 2/3rds majority. Holiday and Testimony: Bastille Day in France on Thursday. British inflation report hearings. Central Banks: Monetary policy meetings scheduled in South Korea, Malaysia, Peru, the U.K., and Canada. […] More
New Overnight Developments Abroad - Daily Update
Good, Bad and the Ugly
July 8, 2016
June saw a much greater-than-expected recovery in U.S. jobs growth. Non-farm payroll employment leaped 287K in June after a slightly downwardly revised 11K increase in May. Jobs grew 147K per month in the second quarter, and the unemployment rate slipped from 5.0% in March to 4.9% in June while touching a 4.7% low for the […] More
Foreign Exchange Insights and Next Week
A Meaningful Financial Market Reaction to the British Vote
July 7, 2016
It was said by proponents of Britain leaving the European Union that predictions of dire financial market and real economic consequences were vastly overstated and that any repercussions would be fleeting and overall inconsequential. Two weeks of post-referendum experience say otherwise. Sovereign debt yields have tumbled, suggesting an elevated risk of recession, the possibility of […] More
Central Bank Watch
National Bank of Serbia
July 7, 2016
Serbia’s central bank policy interest rate was cut to 4.0% today from 4.25%, where such had been since a similar-sized cut in February. The rate was previously reduced by 3.5 percentage points in seven moves during 2015. A statement released by monetary officials today stressed that expected inflation has been falling and that lower inflation […] More
New Overnight Developments Abroad - Daily Update
Investors Less Anxious
July 7, 2016
Investor around the world have grown more accustomed to the prospect of the U.K. leaving the EU. Share prices in the Pacific Rim rose 1.2% in Hong Kong, 1.1% in South Korea and 0.8% in Taiwan but slipped 0.7% in Japan. In Europe, stocks have risen by 1.4% in Britain, 1.3% in France, 1.1% in […] More
Central Bank Watch
National Bank of Poland
July 6, 2016
This week’s monetary policy review in Poland left the central bank reference interest rate at 1.50%, its level since a 50-basis point cut in March 2015. There previously had been nine reductions engineered between November 2012 and January 2014 that cut the reference rate to 2.0% from 4.75%. A statement released after this week’s two-day […] More
