Currency Thoughts

FOMC

larrygreenberg — Wed, 22 May 2013 18:10:18 +0000

Part I: Bernanke Testimony before the Joint Economic Congressional Committee Chairman Bernanke didn’t say anything startling or out of character, but world financial markets swayed to and fro depending on then nuances of the language of his answers and whether such implied reductions in monthly asset purchases happening sooner and by larger increments or the [...]

Bank of Japan: Steady as She Goes

larrygreenberg — Wed, 22 May 2013 16:21:36 +0000

Following a meeting lasting five hours and 28 minutes over two days, the nine-person BOJ Policy Board released a statement that did not break fresh ground. Radical changes were introduced as a “qualitative and quantitative” sea-change on April 4th at the first meeting of the new leadership team. This was the second subsequent meeting, and [...]

A Busy Day

larrygreenberg — Wed, 22 May 2013 11:33:46 +0000

Many things are happening today. One spotlight is on central banks. The BOJ did not change policy of aggressive quantitative easing. The economic assessment was upgraded, but market players are somewhat disappointed that no concrete modifications were announced to stop the erratic yet sharply rising trend in JGB yields, which have roughly doubled since early [...]

Weaker Yen and Pound

larrygreenberg — Tue, 21 May 2013 13:17:42 +0000

A day after suggesting the yen had fallen enough, Japanese Economics Minister Amari retreated, claiming no one really knows how far the yen’s downward correction will go. Sterling fell in response to lower-than-forecast British inflation in April. The lower inflation drops, the greater becomes the Bank of England’s leeway to stimulate growth if that is [...]

Focus on Japan, Not Europe

larrygreenberg — Mon, 20 May 2013 11:08:10 +0000

European trading was dampened by the observance in countries such as France, Austria, Norway, Denmark and Germany of Whit Monday, a Christian holiday. Its been a very light day from the standpoint of released European data. Canada will be observing Victoria Day. Remarks from Japanese Economics Minister Amari caught investors’ attention. He suggested the bulk [...]

Next Week

larrygreenberg — Sat, 18 May 2013 14:36:17 +0000

There is not a heavy calendar of central bank meetings next week. The Bank of Japan and South African Reserve Bank are two of the few. However, the top officials of the Fed, ECB, Bank of Japan, Bank of England, and Bank of Canada each speak publicly. Draghi and Kuroda of the ECB and BOJ [...]

The Disinflation Story: More Evidence

larrygreenberg — Fri, 17 May 2013 15:53:31 +0000

This article updates an earlier blog entry posted two weeks ago. The latest exhibit of global disinflation comes from Canadian April consumer price data released today. On-year total inflation in Canada of 0.4% was sharply less than the 2.0% 12-month increase in the year to April 2012. Excluding food and energy, consumer prices advanced 0.7%, [...]

Central Bank of Chile

larrygreenberg — Fri, 17 May 2013 14:09:21 +0000

The central bank board left the monetary policy interest rate at 5.0%, its level since a sole 25-basis point cut in January 2012. Previously, the rate was raised 475 basis points in a dozen moves between June 2010 and June 2011 after having been cut by 775 bps to 0.5% during the first seven months [...]

Dollar Nicely Bid this Friday

larrygreenberg — Fri, 17 May 2013 11:24:06 +0000

Fresh impetus for a firm dollar was provided by San Francisco President Williams. Usually aligned with Bernanke, he expressed growing confidence in the U.S. labor market and suggested that quantitative easing could be scaled back by summer. The dollar has climbed especially against commodity-sensitive currencies like the loonie (0.7%), kiwi (0.6%) and Aussie dollar (0.5%). [...]

National Bank of Serbia

larrygreenberg — Thu, 16 May 2013 20:35:57 +0000

Serbian monetary officials on May 14 cut the one-week repo rate by 50 basis points to 11.25%. This reduction reverses policy gears, following a string of eight hikes between June 2012 and February 2013 totaling 225 bps. The backdrop for those earlier increases was a sharp acceleration of inflation from less than 3% to more [...]