Deeper Analysis
January 2022 in Figures
January 31, 2022
High global inflation dominated the past month. Central bank interest rates were raised in January in several countries, including Poland, Peru, Romania, South Korea, Ukraine, Sri Lanka, Kazakhstan, Chile, Hungary and South Africa, and markets anticipated that top-tier monetary authorities like those covered in the table below will be following suit. The Bank of England […] More
New Overnight Developments Abroad - Daily Update
With Lunar New Year Under Way, Volatility Persists in Equities and Inflation Worries Remain Uppermost
January 31, 2022
On this last day of January, the Chinese Year of the Tiger has trading shut in China, Hong Kong, Taiwan, and South Korea. The Japanese Nikkei took its cue from the strong U.S. stock market performance on Friday, but that rally looks short-lived with DOW and S&P futures down about a half percent and the […] More
Foreign Exchange Insights and Next Week
Next Week’s Menu: January 29 – February 4, 2022
January 28, 2022
Central Banks: Monetary policies will be reviewed at the European Central Bank, Bank of England, Central Bank of Brazil, Czech National Bank and Reserve Bank of Australia. Governor Lowe of the RBA, ECB President Lagarde and BOE Governor Bailey will hold press conference. The quarterly RBA Monetary Statement will be published. Events and Holidays: OPEC […] More
New Overnight Developments Abroad - Daily Update
Much Data to Peruse on a Snowy Friday
January 28, 2022
But first, a quick rundown of overnight market movement. The DXY weighted dollar index touched an 18-month high of 97.44 but is steady on balance. There’s been no net movement against the euro, Swissie or peso, dips of 0.2% against the yuan and Turkish lira, and upticks of 0.6% against the Aussie dollar, 0.3% relative […] More
Central Bank Watch
Only a 25-Basis Point Interest Rate Hike in South Africa
January 27, 2022
Officials at the South Africa Reserve Bank are attempting to engineer a more gradual normalization of their policy interest rate than, for instance, those at the Central Bank of Chile. Chile’s policy rate has been raised five times by a total of 500 basis points in total to 5.5% since mid-2021. The SARB repo rate, […] More
New Overnight Developments Abroad - Daily Update
Dollar Leaped 1.2% Overnight to 19-Month High
January 27, 2022
Fed Chairman Powell’s implication that Fed tightening in 2022 will exceed market expectations lit a flame under the dollar, which overnight rose 1.2% on a weighted basis to its best level since June 28, 2020. The dollar climbed 0.7% against the euro and Swiss franc, 0.5% relative to the yen, kiwi and sterling, and 0.4% […] More
Central Bank Watch
Big Interest Rate Hike at the Central Bank of Chile
January 26, 2022
Whereas G7 central banks other than the Bank of England (whose interest rate is still a very depressed 0.25%) have not begun interest rate lift-off, the same is not true at many second-tier monetary authorities. For example, the Brazilian Selic rate has been raised from a 2.0% pandemic low to 9.5%. Ukraine’s policy rate has […] More
Central Bank Watch
FOMC Statement and Press Conference: No Big Surprises and A Singularly Anti-Inflation Approach Articulated
January 26, 2022
As expected, the FOMC statement signals that the fed funds rate will likely be raised “soon,” code for the clear possibility of lift-off at the next meeting in March. Inflation has been recategorized from “having exceeded 2%” to “well above 2%.” An assertion of “a strong labor market” was inserted into the statement as a […] More
Central Bank Watch
FOMC Preview
January 26, 2022
Over the six weeks since the last FOMC meeting in 2021, the dollar has risen 0.3% against the yen but dipped 0.2% relative to the euro. The anticipation of Fed interest rate liftoff as soon as March has weighed on equities not only in the United States but also many other countries. The ten-year Treasury […] More
Central Bank Watch
Bank of Canada Drops Exceptional Forward Guidance that Had Committed Keeping Policy Rate at 0.25% Until Around Mid-2022
January 26, 2022
While keeping the central bank’s overnight policy rate at 0.25%, Bank of Canada officials today made a substantial modification in the forward-looking part of their released statement. Previous statements including that after last year’s final policy review on December 8 had promised to “hold the policy interest rate at the effective lower bound until economic […] More
