New Overnight Developments Abroad - Daily Update
Intensifying Fear of a Trade War Generating Stampede from Risky Assets
June 19, 2018
Today’s story lies in market movement, not fresh economic news. The DOW, German Dax and Paris Cac have dropped over 1.0%. Chinese share prices plunged 3.8%. The Hang Seng lost 2.8%. Japan’s Nikkei closed down 1.8%, and the South Korean Kospi fell by 1.5%. The 10-year Treasury yield slid another 3 basis points and is […] More
New Overnight Developments Abroad - Daily Update
Trade War Concerns and Immigration Tensions Rattle Markets Further
June 18, 2018
Share prices fell 1.2% in South Korea and 1.0% in Singapore. In Europe, stocks have thus far dropped 1.4% in Germany, 1.2% in France, 1.1% in Switzerland, 1.0% in Spain, 0.9% in Italy and 0.4% in the U.K.. Markets were closed today in China, Taiwan, and Hong Kong for the Dragon Boat Festival and remained […] More
Foreign Exchange Insights and Next Week
Next Week
June 15, 2018
Central Banks: Monetary policy reviews in the U.K., Switzerland, Thailand, Taiwan, The Philippines, Brazil, Mexico, Norway and Hungary. Release of Bank of Japan minutes. Fed officials speaking publicly include Powell, Bullard, Dudley, Bostic, and Williams. Other central bankers speaking in public include Draghi, Praet, Lautenschlaeger and Coeure of the ECB, Governor Kuroda of the BOJ […] More
Central Bank Watch
Bank of Japan Leaves Policy Unchanged, Downgrades Inflation Outlook
June 15, 2018
Following four hours six minutes of discussion on Thursday and Friday, the Bank of Japan Board voted 8-1 to maintain its policy of quantitative and qualitative monetary easing with yield curve control. The key elements of this stance are A negative 0.1% short-term policy interest rate target. A target of around zero percent on the […] More
Central Bank Watch
Bank of Russia Retains 7.25% Main Interest Rate
June 15, 2018
Russian monetary easing is on pause. The rate had been last cut by 25 basis points in both February and March and before that by a full percentage point during March-June of 2017 and 125 basis points during the final quarter of last year. But after leaving the one-week repo rate at 7.25% following this […] More
New Overnight Developments Abroad - Daily Update
More Trouble
June 15, 2018
President Trump has approved a 25% tariff on $50 billion of Chinese imports. The Bank of Japan gave a gloomier assessment of inflation, downgrading its range to 0.5-1.0% from around 1.0% and observing that medium-term and long-term inflation expectations aren’t escaping a deflationary mindset. Policy settings were left unchanged, and an extremely accommodative stance seemingly […] More
Central Bank Watch
ECB Decisions and Draghi Press Conference
June 14, 2018
Investors found the ECB message today somewhat more dovish than feared. To be sure, the released introductory statement confirmed that new asset purchases will be completed by the end of this year. Draghi’s statement asserts that “progress towards a sustained adjustment in inflation has been substantial so far. With longer-term inflation expectations well anchored, the […] More
Central Bank Watch
Monetary Policy on Hold at Central Bank of Chile
June 14, 2018
The monetary policy rate has been 2.5% since four 25-basis point cuts implemented within the first five months of 2017, and yesterday’s decision announced late in the day again resulted from a unanimous vote. Officials released a statement that revised the near-term inflation forecast upward due to oil price developments and a depreciated Chilean peso, […] More
New Overnight Developments Abroad - Daily Update
Risk-Off Mood in Financial Marketplace
June 14, 2018
Investors are reacting Thursday to An increasing likelihood of four Fed rate hikes this year and three more in 2019 following yesterday’s federal funds rate increase and hawkish press conference. News today from the European Central Bank that monthly asset buying will be sliced in half to EUR 15 billion from October and eliminated altogether […] More
Central Bank Watch
FOMC Statement and Forecasts
June 13, 2018
Today’s FOMC statement raises the federal funds rate by 25 basis points to a target of 1.75-2.0%, depicts a tighter labor market, upgrades the assessment of personal consumption recent conditions, and deletes the prior observation that market-based measures of inflation are low. The statement also introduces the assertion that inflation consistent with the Committee’s symmetric […] More
