Wednesday Briefing – Currency Thoughts

Wednesday Briefing

August 21, 2024

Central bank meetings today ended with decisions to leave interest rates unchanged in Iceland, Thailand, and Indonesia:

• The Bank of Iceland’s 7-day rate has been at 9.5% since a 50-basis point hike in August 2023. CPI inflation there remains too high and above expectations at 6.3%. The rate is at a 14-year high and had been as  0.75% from October 20209 to May 2021.
• The Bank of Thailand’s key rate stays at 2.5%, its level since a 25-basis point increase in September 2023. CPI inflation of 0.8% is marginally under the 1-3% target range.
• Bank Indonesian officials left their rate at 6.25%. The last change was a 25-bp rise last April. CPI inflation  of 2.1% is below the 1-3% target  midpoint.
• FOMC minutes get released later today.

South African CPI inflation slowed to a 28-year low of 4.6% in July.

Canadian producer price inflation held steady at 3.0% last month, having bottomed in May 2023 at -5.7% and peaked in March 2022 at 12.1%.

Polish PPI inflation of -4.8% in July was less negative than in June.

Estonian PPI inflation was 0.8% last month. In Slovenia producer prices were 1.9% softer than a year earlier.

Dutch consumer sentiment this month was unchanged from July.

South Korean business confidence rose two index points to a 5-month high in August.

Japan’s trade deficit of JPY 622 billion was ten times greater in July than a year earlier.

The dollar is little changed. Preliminary PMI results for August get reported tomorrow, and the Jackson Hole Symposium begins.

Copyright 2024, Larry Greenberg. All rights reserved. No secondary distribution without express permission.

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