Central Banks

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The Federal Reserve released it's Biege Book Wednesday with the focus on wages and labor markets. The labor market continues to confound the bankers as despite a tight labor market restraining growth wage pressure remains modest.

Federal Reserve Chairman Jerome Powell testified before the Banking Housing and Urban Affairs of the US Senate Tuesday. The stock market which had been sold off after Netflix missed earnings rebounded as did the US dollar on his words. 

With Trade Wars all around us Federal Reserve Chairman Jerome Powell sat down with marketplace radio and waxed lyrical about the Fed and the economy. However he admitted to being puzzled and not having an answer on why wages aren't higher.

The Reserve Bank of Australia (RBA) as expected kept interest rates on hold at the historic low of 1.5 per cent for the 21st consecutive meeting. Household consumption remains a source of uncertainty. Wage growth remains low, likely to continue for a while.

The Federal Reserve completed its annual stress test and concluded Deutsche Bank for the third time in four years  The Fed also limited the payouts of Goldman Sachs and Morgan Stanley. State Street will have to give the Fed more information on counterparty exposure.

The Bank of England voted 6 to 3 to maintain Base Rate at 0.50% with Haldane joining McCafferty and Saunders to dissent. The asset purchase target of £435 billion for corporate and UK government bond purchases was voted unaminous..

ECB interest rates on the main refinancing operations and the interest rates on the marginal lending facility and the deposit facility will remain unchanged. THe ECB gave an end date for QE but Interest rates to stay on hold until summer of 2019.

The Federal Reserve hiked interest rates a quarter percent as expected after a two day meeting on Wednesday for the third time with Jerome Powell as Chairman. Markets had priced in a 90% chance of 25 bp hike.

The Reserve Bank of Australia (RBA)as expected has kept interest rates on hold at the historic low of 1.5 per cent for the 20th consecutive meeting Household income has been growing slowly and debt levels are high.

The Federal Reserve may keep hiking rates San Franciso Fed President John Williams told Reuters after the strong jobs report Friday He said the Fed may lift interest rates beyond 'neutral' level. 

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