Central Bank Watch
Another Indonesian Central Bank Rate Cut
February 18, 2021
The Board of Governors of Bank Indonesia as expected authorized a 25-basis point cut of its seven-day reverse repo rate to 3.5%, which brings the cumulative reduction since the start of last year to 150 basis points. The previous easing was done just 3 months ago. A released statement observes low inflation, which at 1.55% […] More
Central Bank Watch
Turkish Tight Monetary Policy Maintained
February 18, 2021
Priorities are different at the Central Bank of Turkey, whose economy is again experiencing a vicious cycle of accelerating inflation and lira depreciation. Inflation expectations are higher, fed additionally by elevated food prices. From January to May of 2020, officials cut their one-week repo rate five times by a total of 375 basis points, only […] More
New Overnight Developments Abroad - Daily Update
Stocks and Dollar Falter as Sovereign Debt Yields Resume Their Rise
February 18, 2021
Overnight dollar losses range from 0.7% against sterling to 0.4% relative to the Aussie and New Zealand dollars, 0.3% versus the euro, Swiss franc and peso and 0.2% relative to the yen and loonie. The trade-weighted dollar is 0.3% softer. Ten-year sovereign debt yields are up four basis points in the U.K., lifting the pound […] More
Central Bank Watch
January 26-27th FOMC Minutes
February 17, 2021
At the U.S. Federal Open Market Committee’s first monetary policy review of 2021, officials voted unanimously to continue to target the federal funds rate at 0-0.25% and to purchase a total of $120 billion of bonds per month ($80 billion of Treasuries and $40 billion of agency MBS). Minutes from that meeting released today found […] More
Central Bank Watch
Zambian Central Bank Rate Hike Amid Rising Inflation
February 17, 2021
The Bank of Zambia raised its reference interest rate by 50 basis points to 8.5%, marking the first increase since November 2019. The rate during 2020 had be cut 225 basis points in May and another 125 bps in August, but Zambian inflation has been above the 6-8% target and increasingly so of late. A […] More
New Overnight Developments Abroad - Daily Update
Dollar Rebound Extended 0.3%
February 17, 2021
The dollar is 0.3% stronger on an effective trade-weighted basis. It is up 0.4% against the euro and near the day’s high and touched a 5-month high of 106.22 Japanese yen overnight. The reviving dollar reflects climbing long-term U.S. interest rates as investors are betting on the Congress approving a pandemic relief package of around […] More
New Overnight Developments Abroad - Daily Update
Dollar Strengthened Modestly Overnight
February 16, 2021
The dollar rose 0.2-0.4% against the euro, yen, Swiss franc, sterling, and Canadian, Australian and New Zealand dollars. Japan’s Nikkei-225 equity index, which jumped 1.9% Monday and closed above 30,000 for the first time since 1990, extended that advance by 1.3% this Tuesday. This rise had been ignited by news of a stronger-than-expected 3.0% fourth-quarter […] More
New Overnight Developments Abroad - Daily Update
Japanese GDP Reported and Many Holiday Closures
February 15, 2021
It’s President’s Day in the United States, Carnival in Brazil, Family Day in Canada, and the continuing Lunar New Year holiday break in China and several other Asian markets. The dollar is narrowly mixed and down 0.1% on a trade-weighted basis. Ice-cold temperatures in much of the United States have lifted West Texas Intermediate crude […] More
Foreign Exchange Insights and Next Week
Next Week’s Menu: February 13-19, 2021
February 12, 2021
Central Banks: Monetary policies will be reviewed in South Korea, Indonesia, and Sri Lanka. Minutes from the last Federal Open Market Committee, Reserve Bank of Australia, and European Central Bank policy reviews will be published. Rosengren, Brainard, and Bowman from the Federal Reserve, Schnabel and McCaul from the ECB and Ramsden, Saunders from the Bank […] More
Central Bank Watch
Bank of Mexico Rate Cut
February 12, 2021
Following two monetary policy reviews in which the Bank of Mexico’s easing trend was put on hold, officials there cut their overnight interbank lending rate by 25 basis points to 4.0%. This move had been expected. A released statement notes that Mexican real GDP plunged 8.5% in 2020, which for now is considered a greater […] More
