South Africa Leaves Interest Rates at 8.25%, Rand Falls Rallies with Delayed Rate Cuts

The South African Reserve Bank (SARB) kept its benchmark repo interest rate at 8.25% at its January 25th, 2024, meting as widely anticipated. Rates remain at their highest since 2009. The bank highlighted the persistence of inflation risks while emphasizing a balanced evaluation of risks to medium-term growth. The SARB noted that the return of inflation to the target has been slow, despite the expected gradual moderation. Headline inflation fell for a second month to 5.1% in December from 5.5% … Continue reading “South Africa Leaves Interest Rates at 8.25%, Rand Falls Rallies with Delayed Rate Cuts”

Central Bank of Turkey Raises Another 250 bps to 45%, Signaled End of Rate Hikes

The Central Bank of Turkey hiked by another 250bps from 42.5 percent to 45 percent as expected. It also signaled the end of rate hikes by stating “that the monetary tightness required to establish the disinflation course is achieved and that this level will be maintained as long as needed.” This was consistent with expectations this would be the final hike after the central bank said at its last decision in December that the goal was to “complete the tightening … Continue reading “Central Bank of Turkey Raises Another 250 bps to 45%, Signaled End of Rate Hikes”

New China Draft Rules for Online Gaming Send Chinese Stocks Sharply Lower

Chinese gaming stocks are sharply lower Friday after the Chinese government announced new draft rules for online gaming industry. Tencent’s stock fell -12.35% to HK$274, NetEase dumped -24.60% to HK$122, and Bilibili (BILI) fell around 10% on the Hong Kong Stock exchange. The stocks continued to slide heading into the US opening. Netease fell to 81.69 -22.72 (-21.76%) Pre-Market. BILI 10.32 -1.25 (-10.80%) Pre-Market. The new rules are aimed curbing the amount of money and time players spend playing the … Continue reading “New China Draft Rules for Online Gaming Send Chinese Stocks Sharply Lower”

Central Bank of Turkey Raises Rates By 250 bps to 42.50%, Up 35% since May

The Central Bank of Turkey hiked rates by another 250bps from 40 percent to 42.5 percent at its December meeting. The bank said headline inflation edged up in November and remains in line with the outlook presented in the most recent Inflation Report. The existing level of domestic demand, stickiness in services inflation, and geopolitical risks keep inflation pressures alive. The move follows a hike of 500bps at its November meeting. The move was its seventh big interest rate hike … Continue reading “Central Bank of Turkey Raises Rates By 250 bps to 42.50%, Up 35% since May”

Bank Indonesia Keeps Rates Unchanged at Highest Level Since 2009 to Support Rupiah

Bank Indonesia kept its benchmark interest rate unchanged at 6.00% as universally expected at its December meeting. Governor Warjiyo said, “we will not rush” to ease next year and that they may only have comfort in addressing risks to the stability of the rupiah by “the second half of 2024.” There was little overall effect on the currency or rates. He added the decision was “consistent with the focus of pro-stability monetary policy, to strengthen the stability of the rupiah … Continue reading “Bank Indonesia Keeps Rates Unchanged at Highest Level Since 2009 to Support Rupiah”

Russian Central Bank Hikes Interest Rate to 16% as Wartime Inflation Pressures Mount

Russia’s Central Bank (CBR) in a fight to arrest inflation and the fall of the plummeting Rouble hiked 100bps Friday morning to 16 percent, for the fifth consecutive time since summer to fight accelerating inflation. The Russian economy has been smashed but is said to be recovering on impacts from the invasion of Ukraine by scarcity and falling currency pushing up prices paid. The CBR has now raised its key rate by a cumulative 850 basis points since July, including … Continue reading “Russian Central Bank Hikes Interest Rate to 16% as Wartime Inflation Pressures Mount”

Reserve Bank of India Kept its Key Rate at 6.50%, BSE Sensex index Hits All Time High, Rupee All Time Low

The Reserve Bank of India on Friday made no changes to its interest rates, as expected at 6.50% during its December meeting for the fifth consecutive time. Governor Shaktikanta Das signaled those monetary conditions will remain tight for some time as it looks to further curb inflationary pressures. The RBI has projected retail inflation at 5.4 per cent for Financial Year 2024. The bank has the major focus amid expectations of a spike in food prices in coming months and … Continue reading “Reserve Bank of India Kept its Key Rate at 6.50%, BSE Sensex index Hits All Time High, Rupee All Time Low”

Central Bank of Turkey Raises Rates By 500 bps to 40% with Inflation Stuck at Over 60%

The Central Bank of Turkey hiked by another 500bps, double the consensus, to a new one-week repo rate of 40% at its November meeting. The move was its sixth big interest rate hike in a row as inflation hit 61.36% last month. The weak lira responded minimally, gaining a little but underperforming against most EM crosses and several major ones. The currency response had much to do with the central bank indicating it would keep tightening but at a slower … Continue reading “Central Bank of Turkey Raises Rates By 500 bps to 40% with Inflation Stuck at Over 60%”

Moody’s Lowers Outlook on US Debt to Negative, Towards Fitch and S&P Global Downgrades

Rating agency Moody’s lowered its outlook on the US credit rating to “negative” from “stable”, pointing to a sharp rise in debt servicing costs with higher interest rates and “entrenched political polarization”. The move came after US markets had closed for the weekend. The move followed Fitch and S&P downgraded the US. The credit ratings agency maintained the USA’s top Aaa rating but changed its outlook to ‘negative’. Moody’s is the only of the three big credit rating agencies that … Continue reading “Moody’s Lowers Outlook on US Debt to Negative, Towards Fitch and S&P Global Downgrades”

Reserve Bank of India Kept its Key Rate at 6.50% Repeating a Hawkish Bias as Expected

The Reserve Bank of India on Friday made no changes to its interest rates, as expected at 6.50% during its October meeting. Guidance remained hawkish as Governor Shaktikanta Das signaled those monetary conditions will remain tight for some time as it looks to further curb inflationary pressures. Reserve Bank of India’s (RBI) medium-term inflation target is 4%. The RBI said it is still in accommodation withdrawal mode. India’s yield curve bear steepened with double digit increases in yields from 5s … Continue reading “Reserve Bank of India Kept its Key Rate at 6.50% Repeating a Hawkish Bias as Expected”