Central Bank of Iceland
Weak Data Depresses Long-Term Interest Rates but Not Equities… Dollar Strengthens
August 23, 2023
Ten-year sovereign debt yields dropped overnight by 10 basis points in the U.K., 7 basis points in Germany and 4 basis points in the U.S.. The British FTSE recovered 0.7%. Continental European equities and U.S. stock futures are barely changed. The dollar climbed above Tuesday closing levels by 0.8% relative to sterling, 0.4% versus the […] More
German Recession Confirmed and Interest Rate Decisions in South Korea, Turkey and Indonesia
May 25, 2023
U.S. GDP data will be released shortly. In the meantime, German GDP growth last quarter was revised to -0.3% (not annualized) from zero percent reported originally. That’s the second negative quarter in a row and the third drop in the past four quarter, resulting in a negative year-on-year growth rate of -0.5% as well. The […] More
Central Bank Rate Hikes in Iceland and New Zealand
May 24, 2023
Iceland’s 7-day term deposit rate was lifted 125 basis points to 8.75%. Such had been as low as 0.75% prior to May 2021, 2.0% at the beginning of 2022, and 6.0% when 2023 started. With CPI inflation edged up to 9.9% and measures of long-term expected inflation also creeping higher, the statement released in conjunction […] More
More Pessimism
May 24, 2023
The possibility of a U.S. debt default next month persists. Central Bank interest rates were raised today by 125 basis points in Iceland, 50 bps in Nigeria, and 25 bps in New Zealand. Europe’s largest economy has “suffered a setback” according to the May German business climate index compiled by the IFO Institute. Inflation according […] More
Full Percentage Point Hike of Iceland’s Policy Interest Rate
March 22, 2023
Whereas the Federal Reserve is expected to raise its interest rate only slightly today, the Central Bank of Iceland’s seven-day term deposit rate was lifted by a full percentage point to 7.5%. That increment represents a doubling of the previous 50-basis point hike last month, which in turn was double the 25-basis point moves in […] More
FOMC Day, And Inflation Reports Around the World Aren’t Cooperating
March 22, 2023
Financial markets have positioned for a 25-basis point hike of the federal funds rate later today, which would represent a compromise between conceding the the task of restoring in-target U.S. inflation is still far from accomplished and concern over the way that mid-sized banks have handled the considerable interest rate increase over the past year. […] More
50-Basis Point Icelandic Central Bank Rate Hike
February 8, 2023
The Central Bank of Iceland‘s one-week term rate was raised today by 50 basis points to 6.5%. That incremental size is twice those of the previous two rate increases in October and November. The policy rate was cut five times in 2020, taking such from 3.0% to just 0.75%. Four hikes in 2021 between May […] More
Digesting the Powell and Biden Speeches and Other Central Bank Decisions
February 8, 2023
Fed Chairman Powell yesterday reaffirmed the assertion that inflation has begun to decline but balanced that success with views that the peak in interest rates may be higher than indicated earlier and that the job of restoring in-target inflation will take quite some time longer. With a refrain of let’s-finish-the-job, U.S. President Biden sounded like […] More
Rate Hikes at the Reserve Bank of New Zealand and the Central Bank of Iceland
November 23, 2022
Although not a surprise to investors, the Reserve Bank of New Zealand official cash rate was increased by a larger 75-basis point increment to 4.25%. The prior five changes had been each an increase of a half percentage point. At the start of the tightening cycle in October 2021, the rate had been just 0.25%. […] More
Latest Icelandic Central Bank Rate Hike… and More Promised Ahead
August 24, 2022
the Iceland’s seven-day term deposit rate was raised by 75 basis points to a six-year high of 5.5%. The current tightening cycle in Iceland began in May 2021 from a base of 0.75% and has further distance to go, according to a statement from the Central Bank of Iceland’s Monetary Policy Committee released today. Icelandic […] More
