Archive for December 2018

Central Bank Watch

First Swedish Monetary Policy Rate Hike since 2011

December 20, 2018

The Swedish Riksbank Executive Board raised its repo rate from -0.50% to -0.25%, marking the first rate hike since July 2011 and the first change since a 15-basis point cut in February 2016. The rate has been zero percent or lower since October 2014. A statement from the Board doesn’t anticipate another rate hike until […] More

New Overnight Developments Abroad - Daily Update

Softer Dollar on the First Day After the Fed’s Rate Hike

December 20, 2018

Markets did not take comfort from Wednesday’s FOMC interest rate hike or the upbeat economic prognosis of Chairman Powell. The dollar fell overnight by 0.6% against the euro, 0.5% relative to the yen and  Swiss franc, 0.4% vis-a-vis sterling, 0.3% versus the Australian dollar, and 0.2% against the yuan and loonie. Share prices fared poorly […] More

Central Bank Watch

Markets Not Reassured by Today’s Signals from the Fed

December 19, 2018

The FOMC statement accentuated the U.S. economy’s strong trends of domestic demand and labor market conditions. Comments about inflation were not modified. Concessions to recent jittery markets, President Trump’s criticism that raising interest rates is inappropriate, and the tilt in global data from mostly better-than-expected to primarily softer-than-expected results were slight and worded in a […] More

Central Bank Watch

FOMC Preview

December 19, 2018

It’s been a very eventful period in the market during the 6-week FOMC cycle since the early November policy meeting, but notably the dollar only slipped 0.25% against the euro on balance. Outside of this oasis of stability, however, the ten-year Treasury yield is now 42 basis points lower than then, and the Dow Jones […] More

Central Bank Watch

Bank of Thailand Tightens for First Time Since August 2011

December 19, 2018

The Bank of Thailand’s one-day repo rate was lifted 25 basis points to 1.75% in an expected move. This was the first hike since August 2011 and the first rate change since a pair of 25-basis point cuts in March and April of 2015. According to a released statement, the rate hike was made in […] More

New Overnight Developments Abroad - Daily Update

Dollar Softer Ahead of FOMC Decision and After U.S. Current Account Release

December 19, 2018

Despite weaker data and pressure from Trump, the Federal Open Market Committee is expected to announce the fourth rate hike of 2018 later today but to couch such within more accommodative forward guidance regarding likely policy in 2019. The U.S. current account deficit jumped to $124.8 billion in the third quarter from $101.2 billion in […] More

New Overnight Developments Abroad - Daily Update

U.S. Share Prices Open Higher as Wednesday’s FOMC Decision Nears

December 18, 2018

The dollar is narrowly mixed with tiny downticks of 0.2% against the euro and yen and 0.1% relative to the Swiss franc, Aussie dollar and sterling offset by gains of 0.7% versus the kiwi and 0.5% against the peso. Stocks in the Pacific Rim tumbled 1.8% in Japan, 2.2% in Singapore, 1.4% in Hong Kong, […] More

New Overnight Developments Abroad - Daily Update

Market Worries about Trump

December 17, 2018

The DOW has fallen more than 1.0% to start the new week and to below 24,850, territory not seen since last March. President Trump is the common element in a slew of developments worrying investors. The threat of a presidential veto against any budget bill that doesn’t fund a border wall may shut down the […] More

Foreign Exchange Insights and Next Week

Next Week

December 14, 2018

As officials and the private sector rush to get the month’s work done before yearend holidays, the third week of December tends to be crowded with activity, and 2018 is no exception. Central Banks: Central bank policy reviews in the United States, Japan, the U.K., Sweden, Indonesia, Hungary, Taiwan, Thailand, Mexico, Colombia, and the Czech […] More

New Overnight Developments Abroad - Daily Update

Weak Data Intensify Investor Flight from Risky Assets

December 14, 2018

Equities fell 2.0% in Japan, 1.9% in Hong Kong, 1.5% in China, 1.3% in New Zealand and South Korea, 1.1% in Australia and Singapore, and 0.9% in Taiwan. Share prices are also down 1.0% in the U.S. and Switzerland, 0.8% in France, 0.7% in Italy, and 0.6% in Canada and Germany. The flight to safety […] More

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