Larry's Blog
Dollar Strengthens to 2024 High
April 12, 2024
Fear that Iran is going to attack Israel is augmenting economic factors strengthening the dollar, which climbed 0.7% on a weighted basis to its strongest point since November. Today’s release of U.S. import price data also buoyed the U.S. currency. Import price gains in March of 0.4% both on month and year-on-year exceeded expectations. Import […] More
New Overnight Developments Abroad - Daily Update
U.S. PPI and ECB Rate Announcement Fail To Clarify Confusion about Future Inflation and Central Bank Interest Rates
April 11, 2024
Central bankers have consistently sent a message that disinflation will be a bumpy process and that monetary policy normalization will hinge on growing confidence that inflation targets will be fully resecured. In other words, time and evolving information will dictate what is done. It is not apparent if inflation will meet these parameters without a […] More
New Overnight Developments Abroad - Daily Update
Bad U.S. CPI News Impacts Financial Markets Immediately
April 10, 2024
U.S. consumer price inflation in March exceeded expectations and continued a 2024 pattern of disappointment for investors hoping to see the Federal Reserve lower interest rates. In response, The weighted DXY dollar index is 0.8% above Tuesday’s closing level. The greenback rose 1.4% and 1.0% against the Australian and New Zealand dollar, 0.9% versus the […] More
New Overnight Developments Abroad - Daily Update
Waiting Game Except in Gold’s Case
April 9, 2024
Tuesday’s been another wait-and-see day, with little fresh data to provide direction and being just ahead of tomorrow’s release of U.S. consumer price figures and minutes from the last FOMC U.S. monetary policy meeting. The dollar’s a touch softer, declining overnight by 0.5% against the Australian currency, 0.4% versus the Swiss franc, 0.3% relative to […] More
New Overnight Developments Abroad - Daily Update
Long-Term Interest Rates Higher Still
April 8, 2024
Ten-year sovereign debt yields climbed so far today by four basis points in Germany, two bps in the U.S. and U.K., and a basis point in Japan. The dollar is marginally lower, slipping 0.2% versus the euro, 0.4% against the kiwi, 0.3% relative to the Aussie dollar, and 0.1% vis-a-vis sterling. Not all dollar relationships […] More
Foreign Exchange Insights and Next Week
Next Week’s Menu: April 6-12, 2024
April 5, 2024
Central Banks: Monetary policies to be reviewed at the European Central Bank and in Canada, New Zealand, South Korea, Thailand, Serbia, Israel, Peru, and the Philippines. Minutes will be published from last month’s FOMC meeting, and Kashkari, Goolsbee, Williams and Bostic are some of the Fed officials who will be speaking publicly during the period. […] More
New Overnight Developments Abroad - Daily Update
Spectacular U.S. Jobs Report Underscores Superiority of America’s Economy
April 5, 2024
Whereas share prices have fallen compared to Thursday closing levels by 2.0% in Japan, 1.7% in Spain, 1.5% in Italy, 1.4% in Germany and Great Britain, 1.0% in South Korea, and 0.6% in Australia and Taiwan, the DOW and U.S. S&P 500 show gains of 0.6%, and the tech-intensive Nasdaq index is up 1.1% thus […] More
New Overnight Developments Abroad - Daily Update
Better Market Tone Than Earlier This Week
April 4, 2024
There’s an old adage not to bet against the central bank. Market participants earlier this week had been unnerved by fears that disinflation is stalling amid improving aggregate demand. Yesterday’s speech at Stanford University by Fed Chairman Powell depicted essentially unchanged forward policy guidance. The precise path of the federal funds target may be currently […] More
Central Bank Watch
Central Bank of Chile Cuts Rate
April 3, 2024
The Central Bank of Chile has reduced its policy interest rate by a further 75 basis points, matching analyst expectations. There has previously been cuts of 100 basis points in January and 300 bps in the second half of 2023 from a peak of 11.25% maintained from November 2022 until July 2023. By contrast during […] More
New Overnight Developments Abroad - Daily Update
More Reasons to Keep Investments Safe
April 3, 2024
The news from the Middle East keeps going from bad to worse, and evolving U.S. activity and price data haven’t been quite cooperating with the hope of some Federal Reserve officials to start reducing interest rates at the June FOMC meeting. Fed Chairman Powell delivers a speech today before the Stanford Business, Government and Society […] More
