Central Bank of Iceland

Central Bank Rate Hike in Iceland

February 9, 2022

The Central Bank of Iceland’s policy interest rate has been lifted 75 basis points to a two-year high of 2.75. This was the fifth rate hike since its pandemic low of 0.75%, following increases of 25 basis points last May, August, and October as well as a 50-basis point incremental rise in November. CPI inflation […] More

Lessening Risk Aversion

February 9, 2022

The recent sell-off in bonds has taken a step back, and that has encouraged bottom-feeding in equities. Nonetheless, markets have come a long way in the first five weeks of 2022. The 30 year U.S. fixed mortgage rate rose another five basis points last week and, at 3.83%, was 56 basis points above its end-2021 […] More

Icelandic Central Bank Rate Hike

November 17, 2021

The Central Bank of Iceland‘s policy interest rate has also been raised multiple times in response to the recent acceleration of inflation. Today’s hike to 2.0% from 1.5% increased the ante following 25-basis point advances in May, August, and October. “The inflation outlook has deteriorated somewhat since August, owing in part to more persistent global […] More

Persistent Global Pressure on Prices, Some More Central Bank Hikes, and the Dollar Touches Its Firmest Level Since July 2020

November 17, 2021

The weighted DXY dollar index touched 96.24 overnight, its strongest level since the first week of July 2020, but has settled back to show no net changed. Relative to Tuesday closing levels, the dollar is down 0.3% relative to the kiwi, yuan, peso, and sterling and by 0.1% vis-a-vis the euro, yen and loonie. The […] More

Central Bank of Iceland Implements Third Rate Hike of 2021

October 6, 2021

At the Central Bank of Iceland, the seven-day term deposit rate was increased by 25 basis points to 1.5%. This is the third quarter percentage point tightening since May. Inflation topped 4% at 4.4% last month, and supply chain shortages continue, further risking an upward drift in inflation expectations. While first-half growth underperformed the expectations […] More

Inflation Surprises Persisting, Central Banks Reacting, and Investors Fretting about What Lies Just Ahead

October 6, 2021

Against the backdrop of  central banks reacting to higher-than-forecast inflation, the dollar continues to be a well-bid currency. The weighted DXY dollar index came within a 0.05-point whisker overnight of matching its 52-week high set last November. The U.S. currency also rose 1.1% against the kiwi and Mexican peso, 0.7% versus the euro and Aussie […] More

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

Softer Business Confidence, A Rate Hike in Iceland, and Awaiting Clarification of Fed Policy Plans

August 25, 2021

The Jackson Hole annual central banker conference begins tomorrow at which investors hope to glean greater clarification of the Fed’s exit strategy. The Delta Variant’s wave of higher coronavirus infections has cast a shadow over how aggressively Federal Reserve officials will taper quantitative monetary stimulus. Global infections are closing in on the 215 million level. […] More

Bitcoin Disaster, Equities Fall Again, and Mixed Inflation News

May 19, 2021

The Bitcoin fallout from Elon Musk’s reversal on Tesla-for-bitcoin transactions has been huge. The cryptocurrency dropped over 20% overnight and at its intra-day low was showing a 43% loss over the past five weeks to its lowest level in 11 weeks. Wednesday’s been a difficult day for equity trading as well, with losses in the […] More

European March Purchasing Manager Surveys Show Healthier Growth than Expected but Perhaps Outdated Due to Worsening Covid There

March 24, 2021

The dollar strengthened in Asian trading, reaching its strongest trade-weighted level since Thanksgiving, but it has subsequently trimmed those gains. Compared to Tuesday closings, the dollar is up 0.3% relative to the Turkish lira and sterling and by 0.1% versus the euro, Swiss franc and DXY effective value. Dollar/yen is unchanged, and so are the […] More

css.php