Archive for the 'Forex news' Category
FOMC: low rate of resources utilization warrant zero-interest rate policy
FOMC: low rate of resources utilization warrant zero-interest rate policy As expected, the FOMC opted to keep interest rates unchanged. With respect to the assessment of current and future economic activity, the FOMC showed increased optimism. Over the course of past three meetings, its assessment of current conditions has changed from a “levelling out” to a “continued pick-up” in activity with the support of household spending. Despite the improving economic backdrop, however, the central
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Czech: CNB stays on hold despite dovish signal from its new forecast
Yesterday, the CNB Bank Board decided to keep interest rates on hold by a narrow 4-to-3 majority. This was out of step with expectations following the release of the previous voting result, where both the Governor and the Vice-Governor had been in favour of cutting the key rate to 1%. Nevertheless, the close outcome of the vote shows that efforts were clearly made in certain quarters to reduce rates. One of the likely factors persuading the Board to leave rates unchanged was the latest central
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ECB pre-announces gradual exit from emergency liquidity measures
ECB notes improvement in European activity but remains relaxed about inflation. Trichet hints that ECB won’t renew 12 month funding to banking system after December Markets may think ECB “exit strategy” implies earlier interest rate increases, but… ...Economic outlook still uncertain and the Bank of England eased policy further today. Reducing emergency support to the financial system will be a delicate operation. So we think ECB rates still unlikely to rise before September 2010 at the
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G20-meeting: Tobin tax steals headlines
With G20 countries on a time schedule for coordinating and reviewing individual countries’ economic policies, the process already revealed some weakness as G20 was not able to agree on more specific policy goals. UK Prime Minister’s proposal to tax financial transactions is dead on arrival. However, a special tax on financial institutions to finance future bailouts remains on the agenda. Exchange rates issues were avoided in the final communiqué. However, IMF believes CNY is significantly
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Bank of Japan: More upbeat, more balanced
As expected, the Bank of Japan (BoJ) today left its leading interest rate unchanged at 0.1%. However, it upgraded its view of the economy markedly. While BoJ remains cautious about the economy, its main message is that the economy is improving and risks to its growth and inflation outlook have started to become more balanced. Interest rate hikes in Japan are far off and will most likely lag both the ECB and Fed – albeit not by as much as the market currently expects. With BoJ upgrading its
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Preview of BOE & BOC policy meetings
BOE meeting The Bank of England (BOE) will meet on Thursday, September 10th. At the August BOE policy meeting the BOE decided to hold interest rates unchanged at a record low 0.5% and announced a surprise expansion of quantitative ease. The BOE increased its quantitative ease program from £125 bln to £175 bln. The MPC minutes for the August meeting indicated that the BOE policy board was split over the decision to expand quantitative ease with three board members including BOE Governor King
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BoC Policy Monitor: BoC is more upbeat on the economic outlook
As expected the Bank of Canada left the overnight rate unchanged at 0.25 % and maintained its conditional commitment to maintain it at this level until the end of Q2 2010. Although the commitment is maintained, the tone of the press release was significantly more upbeat when it comes to both global and Canadian economic prospects. Whereas our central bank previously saw early strength in domestic demand as “just” a bringing forward of household expenditures, it now sees the recent rebound in
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ECB preview: Waiting for the master plan
The ECB is expected to leave the refinancing rate unchanged at the Governing Council meeting on Thursday. We expect the tone at the press conference to turn slightly more positive (again) as both soft and hard data continues to improve further, but Trichet is unlikely to signal any rate hikes for the near future. Trichet might hint that the ECB intends to begin to roll back unconventional measures next year, but we do not expect him to give anything like a master plan or even an indication of
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BOE and ECB: Preview of Thursday’s meetings
The Bank of England (BOE) will hold a policy meeting on Thursday November 5th. At the October policy meeting the BOE elected to maintain the current level of interest rates at a record low 0.5% and asset purchases at £175bln. The BOE indicated that they would keep the scale of the asset purchase plan under review. Two recent UK economic reports generated concern about the outlook for the UK economy and may encourage the BOE to expand its asset purchase plan at the November policy meeting. UK
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Preview: FOMC November rate decision
The FOMC is expected to keep interest rates in a 0-0.25% range at the November meeting and could refrain from major changes to the accompanying statement after much speculation last week. On the whole, analysts believe the Fed will stick to the wording: rates to stay low for an ‘extended period’ for at least one more month as inflationary pressures continue to remain subdued due to the enormous slack in the economy and high unemployment levels. Though, some analysts believe there is still a
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