Central Bank Watch

Peruvian Central Bank Rate Hike

May 12, 2022

The Central Reserve Bank of Peru’s policy interest rate had been at 2.25% when the pandemic struck in early 2020. Back-to-back percentage point cuts in March and April pinned the rate at 0.25% where it remained for fifteen months. Peruvian CPI inflation of 1.6% in June 2020 had constituted an 18-month low and in the […] More

Another Hike of Mexico’s Overnight Interbank Interest Rate Target

May 12, 2022

The Bank of Mexico’s Governing Board was still in an accommodating mood one year after the pandemic’s onset and made one final cut of its policy interest rate in February. But as inflation in Mexico and around the world began to heat up that spring, it did not take the central bank officials long to […] More

Second Serbian Central Bank Rate Hike

May 12, 2022

The National Bank of Serbia, which in April authorized its first interest rate hike in over ten years, just matched the 50-basis point size of that initial increase. A noted above, Serbian CPI inflation has accelerated more than threefold over the past year to 9.6% and is well above target. The new central bank interest […] More

Malaysia’s First Central Bank Rate Hike Since 2018 Surprised Analysts

May 11, 2022

There’s been a 25-basis point increase in Bank Negara Malaysia’s policy interest rate that was not foreseen by analysts. This hike to 2.0% from 1.75% marks the first increase since January 2018. Malaysian CPI inflation in April of 2.2% had been a tad low than forecast and matched the lowest level since August 2021. A […] More

National Bank of Romania’s Policy Interest Rate Raised 75 Basis Points to 8-Year High of 3.75%

May 10, 2022

While Federal Reserve officials have been talking the talk of an expeditious tightening of monetary policy, many other central banks have been actually walking the walk. The National Bank of Romania is one of these. Today’s announced Romanian interest rate hike was the largest in a string of six increases since October. In all, the […] More

FOMC Statement and Press Conference

May 4, 2022

By a vote of 10-0, the Federal Open Market Committee increased the target range for the federal funds rate by the expected 50 basis points to 0.75-1.00%. An acknowledgment of negative GDP growth in 1Q 2022 is counter-balanced by assertions that personal consumption and business investment remain strong, an upgraded characterization of employment growth to […] More

FOMC Preview

May 4, 2022

Not  much could have been said by officials in the seven weeks since the first FOMC hike to prepare markets for a doubling of the rate hike increment to 50 basis points. This will be the first hike of a half percentage point since May 2000. With that prospect in mind, the 10-year U.S. Treasury […] More

Reserve Bank of Australia Commences Interest Rate Up-Cycle

May 3, 2022

The Reserve Bank of Australia today engineered its first interest rate increase of any size since November 2010, raising the Official Cash Rate by a greater-than-expected 25 basis points to 0.35%. Governor Lowe released a statement that asserts officials are “committed to doing what is necessary to ensure that inflation in Australia returns to target […] More

Central Bank of Russia Cuts Interest Rate Sharply Further

April 29, 2022

The Central Bank of Russia felt sufficient room to implement its second 300-basis point cut this month in its policy interest rate, which now becomes 14.0%.  Officials had been expected to reduce interest rates by just 200 basis points. Its statement of explanation touted the ruble’s recovery to pre-war levels and asserted that with”price and […] More

Surprise Rate Hike in Sweden is First Increase since December 2019

April 28, 2022

The Swedish Riksbank announced a dramatic shift in its policy. The repo rate was raised from zero percent to 0.25%, defying a promise made as recently as the prior meeting in February not to raise such until well into 2024. Large global uncertainties and rapidly rising CPI inflation across a broad front forced this change […] More