Central Bank Watch

A Turkish Central Bank Rate Cut and a Norwegian Rate Increase on the Same Day

December 16, 2021

Thursday’s central bank action illustrated the broadening diversity of monetary policies around the world amid rising inflation but also persistent uncertainty related to the coronavirus pandemic. The Turkish lira got clobbered, slumping more than 5.0% further after the Central Bank of the Republic of Turkey reduced the one-week repo rate by another 100 basis point […] More

Bank of England Raises Bank Rate by 15 bps to 0.25%

December 16, 2021

The Bank of England’s nine-person Monetary Policy Committee lifted the bank rate by 15 basis points to 0.25% in an 8-1 decision and indicated that modest further increases will probably be needed in 2022. Today’s move was somewhat controversial insofar as Britain is being hammered by the rapidly spreading Omicron Variant and now undergoing renewed […] More

FOMC Statement, Projections, and Press Conference

December 15, 2021

In several respects as implied in today’s statement, Fed officials are more comfortable now than in early November with removing accommodation. The tapering of monthly bond purchases was increased significantly and on a pace to end after mid-March rather than at mid-2022. The projected likely fed funds rate level a year from now is 0.6 […] More

FOMC Preview

December 15, 2021

After the last Federal Open Market Committee review of U.S. monetary policy on November 2-3, officials laid out a tentative scheduled for tapering net asset purchases by $15 billion per month. At that pace, it would take eight reductions to completely halt the growth in holdings after next June, with the caveat of being ” […] More

Rate Hike at National Bank of Ukraine

December 10, 2021

officials at the National Bank of Ukraine chimed in with their fifth rate hike of 2021, a 50-basis point increase to 9.0% that follows 250 basis points of tightening from the four earlier moves. In a released statement, the Executive Board acknowledges a bigger global wave of inflationary pressures and a slower-than-assumed decline of inflation […] More

Peruvian Central Bank Rate Hike

December 9, 2021

There have now been five increases in the Central Reserve Bank of Peru’s policy interest rate since August, an initial 25-basis point move then followed by four successive monthly increases of 50 basis points each. In a released statement from the Board of Directors of the bank, officials warn investors not to assume that Peru […] More

Brazilian Selic Rate Began 2021 at 2.0% and Ending the Year at 9.25%

December 8, 2021

The Copom committee at the Central Bank of Brazil that decides monetary policy settings unanimously voted to hike its Selic interest rate by 150 basis points to 9.25%, matching the previous advance in October that had been the largest since 2002. Rate cuts of 250 basis points in 2020 have been far exceeded in 2021 […] More

Polish Central Bank Interest Rate Raised 3 Times by Total of 165 Basis Points in Final Quarter of 2021

December 8, 2021

Following up on hikes of 40 basis points in October and 75 bps in November, officials at the National Bank of Poland lifted the reference interest rate today by 50 bps to 1.75%. In so doing, the entire post-pandemic rate reduction in 2020 from 1.50% at the start of last year has been reversed and […] More

A Second Hike of the Reserve Bank of New Zealand’s Official Cash Rate

November 24, 2021

An initial OCR increase of 25 basis points had been done in October, and such has been followed by a second hike of same size to 0.75%. The rate had been previouslyat a record low of 0.25% from mid-March 2020.  A released statement sees continuing reductions in monetary stimulus. Capacity pressures have continued to tighten. […] More

Turkish Central Bank Rate Cut

November 18, 2021

Turkish monetary policy has become very politicized this year, conforming to the wishes of President Erdogan’s view that inflation conforms positively, not inversely, to changes in the central bank interest rates. Erdogan has secured his desired downtrend in Turkey’s one-week repo rate by replacing policymakers at the Central Bank of Turkey who disagreed with him. […] More