Central Bank Watch

Iceland’s Second Central Bank Rate Hike of 2021

August 25, 2021

The Central Bank of Iceland’s policy interest rate was increased another 25 basis points to 1.25%. An initial hike of similar size had been engineered earlier this year in May. During the opening five months of 2020, the rate had been reduced by a total of 225 basis points to 0.75%. Iceland is the only […] More

A Third Central Bank Interest Rate Hike in Hungary

August 24, 2021

As was expected, the National Bank of Hungary’s base rate was lifted another 30 basis points at this month’s review of monetary policy. Such follows similar hikes made in June and July and brings the rate level to 0.90%, its highest level since mid-2015. In 2020, two cuts of 15 basis points each had been […] More

Central Bank Rate Hike in Peru

August 13, 2021

An interest rate hike surprise has been sprung by officials at the Central Reserve Bank of Peru. With inflation accelerating there more than half a percentage point to 3.8% in July, monetary policymakers doubled their policy interest rate to 0.5%. This increase was the first change since a pair of 100-basis point reductions in March […] More

Bank of Mexico Officials Implement Second Straight 25-Basis Point Hike of Overnight Interbank Rate

August 12, 2021

The 25-basis point interest rate increases in June and now reverse cuts last February and September, and the new rate level of 4.5% becomes the highest in a year but well below the pre-pandemic level of 7.25%. A statement from the Bank of Mexico foresees a danger of inflation tracking above its baseline forecast because […] More

Bank of England Policy Review

August 5, 2021

The Bank of England’s Monetary Policy Committee again voted unanimously to leave its Bank Rate unchanged at 0.10%. Officials however concede that the recent acceleration of inflation has exceeded their expectations by a significant margin, and they now foresee the 12-month rate of CPI increase to hit 4.0% later this year. Moreover, officials are somewhat […] More

Czech Monetary Policy Tightened for Second Time This Year

August 5, 2021

The Czech National Bank today followed up on an initial 25-basis point increase of its two-week repo rate that was done in June. From March to May of last year the rate had been slashed by 150 basis points in three moves. Today’s increase was also by 25 bps and brings the 2-week repo rate […] More

Brazilian Selic Rate Lifted to 5.25% from 4.25%

August 5, 2021

A fourth central bank interest rate hike this year has been engineered in Brazil, and the increase of a full percentage point exceeded expectations. At 5.25%, the Bank of Brazil’s Selic Rate is now 325 basis points above its level at the beginning of March. Copyright 2021, Larry Greenberg. All rights reserved. No secondary distribution […] More

50 Basis Point Hike to 10% the National Bank of Georgia’s Policy Interest Rate

August 4, 2021

Officials at the National Bank of Georgia authorized this year’s third refinancing rate hike, this time by 50 basis points to 10.0%. There had also been increases of 50 bps in March and 100 bps in April. Tighter monetary policy has been necessitated by a spike in inflation to 11.9%, which is way above the […] More

FOMC Statement and Powell’s Press Conference

July 28, 2021

Aside from some inserted clarification regarding the timetable to tapering quantitative stimulus, little was changed in today’s FOMC statement. The economy has made progress toward these goals [of ┬ámaximum employment and inflation rising to 2 percent and being on track to moderately exceed 2 percent for some time], and the Committee will continue to assess […] More

Interest Rate Hikes in Hungary and Kyrgyzstan

July 27, 2021

A 30-basis point increase in the National Bank of Hungary’s base rate to 1.2% was larger than what analysts were predicting and represents the second such hike in a month. Magyar Nemzeti Bank’s overnight deposit rate was increased from -0.05% to +0.25%. The base rate level is now at its highest level since early 2016. […] More