Foreign Exchange Insights and Next Week
It Took Longer Than Generally Remembered for the Volcker and Greenspan Fed To Restore Price Stability
March 17, 2022
Several questions at Fed Chairman Powell’s press conference yesterday tried to elicit a response about whether it is possible to shrink U.S. inflation back to the target of 2.0% without nearly stalling economic growth or even putting the U.S. economy through a recession. Powell did not say definitively yes or no but gave reasons for […] More
Central Bank Watch
Bank of England Tightens as Expected, and More Moves Lie Ahead
March 17, 2022
The Bank of England as expected engineered a 25-basis point increase in its Bank Rate, but the 8-1 vote included a dissent in favor of a 50-basis point increase. The rate had previously been raised by 15 basis points in December and 25 bps in February, and at 0.75% is now back to its pre-pandemic […] More
Central Bank Watch
Central Bank of Ubekistan
March 17, 2022
The Central Bank of Ubekistan‘s policy interest rate was jacked up three percentage points to 17%, its highest level since the final 7 months of 2004 when such was at 18%. In between, the rate had been as low as 9% from the start of 2015 until mid-2017. During the first pandemic year, there had […] More
Central Bank Watch
Hong Kong and Taiwan Central Bank Rate Hikes
March 17, 2022
Officials at the Hong Kong Monetary Authority and Central Bank of the Republic of China (Taiwan) announced 25-basis point interest rate hikes in lockstep actions following the Federal Reserve’s similar move. After the first hike since December 2018, Hong Kong’s new base rate level will be 0.75%. Taiwan’s discount rate had been at 1.125% since […] More
Central Bank Watch
Central Bank of Brazil Tightens for a Ninth Time
March 17, 2022
A full percentage point increase in the Central Bank of Brazil‘s Selic rate to 11.75% matched what analysts were expected. The move was agreed unanimously, and a released statement foreshadows a similarly-sized rate hike at the next policy review: “For its next meeting, the Committee foresees another adjustment of the same magnitude. The Copom emphasizes […] More
New Overnight Developments Abroad - Daily Update
Inflation and Russian Invasion of Ukraine Casting Longer Shadows
March 17, 2022
Equities behaved in a widely diverse way overnight after the Fed enacted the first of many rate hikes. Share prices closed up by 7.0% in Hong Kong, 3.5% in Japan, 3.0% in Taiwan, 1.8% in India, 1.7% in China, and 1.1% in Australia. But stock markets so far are down this Thursday by 1.0% in […] More
