Strong Yen Sales October 2, 2024 Japan’s ultra-loose monetary policy when other central banks scrambled to tame a sharp rise inflationary pressure in 2021-3 had encouraged investors to borrow essentially free money offered in Japan and invest in higher yielding assets elsewhere. Those so-called carry trades are now being reversed and consequently driving down the…
Dollar Steps Up as Final Quarter of 2024 Begins October 1, 2024 Remarks by Fed Chairman Powell yesterday afternoon countered mounting speculation of another 50-basis point rate cut, offering the alternative of two 25-bp moves before yearend as a far likelier scenario. In response, the dollar rebounded overnight by 0.4% against the euro, sterling and…
Rate Cut Fever September 25, 2024 In the wake of a disappointing and unexpected relapse in U.S. consumer confidence in the Conference Board’s monthly measure this month, financial markets are attaching greater odds to another interest rate cut by the FOMC at its early November meeting following the sizable 50-bp initial reduction made earlier this…
Downward Rate Cycle Resumed in Hungary September 24, 2024 From a base rate peak of 13.0% maintained for nearly a year, officials initiated a declining trend eleven months ago that methodically made cuts at ten straight monthly meetings until the one in August when the rate was kept at 6.75%. CPI inflation had crested slightly…
Investors Heartened by Hopes of Lower Interest Rates while Disregarding Enhanced Likelihood of a Trump Victory and the Direr Middle Eastern Situation September 24, 2024 Latest U.S. opinion polls show revived support for former President Trump especially among key swing states. Odds of a multi-dimensional war in the Middle East have risen. This also favors…
Bank of Japan September 23, 2024 Although analysts were not anticipating a third Bank of Japan rate hike today, the gist of the released statement and subsequent remarks by Governor Ueda contained a more nuanced message than expected. With firms’ behavior shifting more toward raising wages and prices recently, exchange rate developments are, compared to…
European Growth and Inflation Weakened This Month September 23, 2024 Investors appear satisfied that Fed officials chose the larger 50-basis point cut option last week. U.S. equity futures are retaining though not extending last week’s stock market rally. A final estimate of U.S. second-quarter GDP and August personal consumption and the PCE price deflator headline…
Next Week’s Menu: September 14-20, 2024 September 13, 2024 Central Banks: Monetary policies will be reviewed at the Fed, Bank of Japan, Bank of England, Bank of Norway, Bank Indonesia, People’s Bank of China, Central Bank of Turkey, Central Bank of Brazil, South African Reserve Bank, Central Bank of the Republic of China, and National…
Central Bank Rate Hike to 19% in Russia September 13, 2024 Officials at the Central Bank of Russia face an altogether different set of circumstances due to President Putin’s attempt to restore the Russian Empire. CPI inflation has reaccelerated from 2.3% in April 2023 to a 13-month high of 9.1%. After the latest review of…
Peruvian Interest Rate Cut September 13, 2024 There has been a 25-basis point further cut in the reference interest rate of the Central Reserve Bank of Peru. The new 5.25% level constitutes a 27-month low and is down from the 7.75% peak maintained from June 2023 until September 2023. According to a released statement, “Year-on-year…