July 2019 in Figures
July 31, 2019
Even though only the Fed among major central banks cut interest rates in July, long-term interest rates declined in Europe but changed hardly at all over the course of the month in the United States, Canada, or Japan. The Fed’s 25-basis point interest rate cut announced on the final day of the month was its first rate reduction since December 2008 and represents a very different bias than in 2018 when it engineered four increases. The last of those moves had elicited scathing criticism from the Trump Administration. In explaining today’s easing move, Chairman Powell presented an upbeat view on U.S. economic trends, with the notable exceptions of fixed business investment and manufacturing, and he said that these points of softness reflected not excessive U.S. interest rates but rather global uncertainties particularly related to trade protectionism. Ironically, the trade fight that President Trump has waged has caused the dollar to appreciate. The U.S. currency rose in July against all the other currencies in the table below. If dollar appreciation persists, the easing of U.S. monetary conditions from lower short-term interest rates could be blunted by lessening U.S. price competitiveness. This would also mitigate progress on another top priority of the Trump Administration, which is a reduction of the U.S. trade and current account deficits. Finally, the prices of oil and gold changed by less than 1.0% during July.
| 10-Yr Yield | 06/28/19 | 07/31/19 | Chg in July |
| U.S. | 2.01% | 2.01% | 0 Basis Points |
| Germany | -0.33% | -0.44% | -11 |
| Japan | -0.17% | -0.16% | +1 |
| U.K. | 0.83% | 0.61% | -22 |
| Canada | 1.46% | 1.48% | +2 |
| Switzerland | -0.58% | -0.81% | -23 |
| CB Policy Rate | 06/28/19 | 07/31/19y | Chg in July |
| Fed funds target | 2.25/2.50% | 2.00/2.25% | -25 Basis Points |
| ECB deposit rate | -0.40% | -.040% | 0 |
| BOJ policy rate | -0.10%- | -0.10% | 0 |
| BOE Bank Rate | 0.75% | 0.75% | 0 |
| Swiss 3M Libor | -1.25/-0.25% | -1.25/-0.25% | 0 |
| FX | 06/28/19 | 07/31/19 | Pct Chg in $ |
| EUR/USD | 1.1373 | 1.1062 | +2.8% |
| USD/JPY | 107.85 | 108.81 | +0.9% |
| USD/CHF | 0.9762 | 0.9946 | +1.9% |
| GBP/USD | 1.2696 | 1.2151 | +4.5% |
| AUD/USD | 0.7020 | 0.6837 | +2.7% |
| NZD/USD | 0.6718 | 0.6560 | +2.4% |
| USD/CAD | 1.3095 | 1.3205 | +0.8% |
| USD/CNY | 6.8668 | 6.8811 | +0.2% |
| Equities | 06/28/19 | 07/31/19 | Chg in July |
| S&P 500 | 2942 | 2980 | +1.3% |
| Nasdaq | 8006 | 8175 | +2.1% |
| Djia | 26600 | 26864 | +1.0% |
| Dax | 12399 | 12189 | -1.7% |
| Nikkei | 21276 | 21522 | +1.2% |
| Ftse | 7426 | 7587 | +2.2% |
| Canada TSE | 16382 | 16407 | +0.2% |
| Swiss SMI | 9898 | 9919 | +0.2% |
| Commodities | 06/28/19 | 07/31/19 | Chg in July |
| Oil, $ per barrel | 58.20 | 57.96 | -0.4% |
| Gold, $ per ounce | 1412.50 | 1424.90 | +0.9% |
Copyright Larry Greenberg 2019. All rights reserved. No secondary distribution without express permission.
Tags: central bank policy rates, foreign exchange, gold and oil, share prices, sovereign debt yields
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