Central Bank Watch – The Big Three Fed, ECB and BoE Set to Raise Rates Again

This week’s central bank main event was The Bank of Canada who hiked by 25bps to 4.50%. The Bank of Thailand raised its key interest rate by 25 basis points to 1.5%. Colombia’s BanRep hiked by 75bps but signaled the end of cycle nearing. Chile left their benchmark at 11.25% with a neutral bias. South Africa hiked the repo rate by 25bp to 7.25%. In the week ahead we get four central banks delivering policy decisions. We have the big … Continue reading “Central Bank Watch – The Big Three Fed, ECB and BoE Set to Raise Rates Again”

Bank of Canada Hikes Rates 25 bps to Highest Level Since 2008, Signals Holding Pattern

Bank of Canada raised the target for its overnight rate by 25bps to 4.50% in January 2022, as expected. The move follows the aggressive hikes at the last four meetings. It was the eighth consecutive rate hike pushing borrowing costs to the highest level since 2008. Notably the BoC Governing Council said “If economic developments evolve broadly in line with the MPR outlook, Governing Council expects to hold the policy rate at its current level while it assesses the impact of the cumulative … Continue reading “Bank of Canada Hikes Rates 25 bps to Highest Level Since 2008, Signals Holding Pattern”

Central Bank Watch – Fed Tempers Rhetoric, Bank of Canada Ahead

This week’s central bank main event was The Bank of Japan who kept the status quo sending the dollar yen up 300 pips putting a bid inequities and bonds. We saw no change from the People’s Bank of China, Norges Bank, Bank Negara Malaysia Bank, and Central Bank of Turkey from their monetary policy meetings. Bank Indonesia however raised another 25bps. The Federal Reserve Biege Book was consistent with what we have seeing with economic data released, not a lot … Continue reading “Central Bank Watch – Fed Tempers Rhetoric, Bank of Canada Ahead”

Central Bank Watch – Korea Raises, BOJ Sequel to JGB, Dollar Yen Massacre Ahead

This week’s main event was Chair Powell’s speech at the Riksbank International Symposium and the reaction to US CPI, the reaction was muted to a soft report, outside of rising Services inflation. The Bank of Korea raised the Base Rate to 3.50%, the highest level since late 2008 as expected. Bank of England policymaker Mann said more needs to be done on rates and there is no risk of overtightening yet. We had a slew of Fed speakers but nothing … Continue reading “Central Bank Watch – Korea Raises, BOJ Sequel to JGB, Dollar Yen Massacre Ahead”

Central Bank Watch – Powell, ECB and BoE Speakers at Riksbank

We kicked off 2023 with no surprises from the FOMC December meeting minutes which were followed up a barrage of Fed Speakers later in the week. They continued the party line but did caution on too fast, too high. This week’s main event will be Chair Powell’s speech at the Riksbank International Symposium and the reaction to US CPI, particularly given U.S. Treasuries closed out the first week of 2023 in beastly form Friday following the December jobs report average hourly earnings … Continue reading “Central Bank Watch – Powell, ECB and BoE Speakers at Riksbank”

Central Bank Watch – Fed Minutes and Speakers Kick off 2023

The highlight this week will be the FOMC Minutes on Wednesday from the December meeting. The equivalent meeting last year was when it became clear the Fed was pivoting to an aggressive agenda and the S&P had topped just two days before. From then we got the beginnings of the end for the stock market, crypto, bonds and a slew of other assets. We also get a barrage of Fed Speakers on Thursday and Friday, no doubt aware of marker … Continue reading “Central Bank Watch – Fed Minutes and Speakers Kick off 2023”

Central Bank Watch – The Bank of Japan Shocks, Turkey and Indonesia as Expected

The highlight this week came from the Bank of Japan. The BoJ shocked markets adjusting the central bank’s yield curve control program which saw yields rise sharply and a similar move in the yen. Dollar Yen went from 137.20 to 133.20 on the announcement. 10-year JGB yields surged to 0.455%, the highest since 2015 leading to a limit down halt on the Osaka Exchange. The Central Bank of Turkey left its key one-week repo rate unchanged at 9% in its … Continue reading “Central Bank Watch – The Bank of Japan Shocks, Turkey and Indonesia as Expected”

Central Bank Watch – Central Bank Collusion in Rate Hike Extravaganza

It was a huge week for Bankers, we had the big central bank triple header, the Federal Reserve (Fed), Bank of England (BOE) and European Central Bank (ECB) all deliver their last meetings of 2022. Markets responded with risk off and the spread widened between European and U.S. paper. Treasury yields declined this week in the face of a surge in European yields. It was more than the big three, the Central Bank collusion continued, a necessity given the strong … Continue reading “Central Bank Watch – Central Bank Collusion in Rate Hike Extravaganza”

Central Bank Watch – Fed, ECB and BoE Triple Play

A huge week for Bankers, we have the big central bank triple header, the Federal Reserve (Fed), Bank of England (BOE) and European Central Bank (ECB) all deliver their last meetings of 2022. The FOMC will also include an updated Summary of Economic Projections that will provide some insight on terminal rate projections.  Monetary policy meetings also ahead from the Philippines, Swiss National Bank and the Bank of Mexico. We get the US, UK, India, and South Africa all releasing … Continue reading “Central Bank Watch – Fed, ECB and BoE Triple Play”

Bank of Canada Hikes Rates 50 bps to Highest Level Since 2008

Bank of Canada raised the target for its overnight rate by 50bps to 4.25% in December 2022, the market had been pricing a 62% chance of a 25-bps hike while economists narrowly favored the 50-bps hike. The move follows the aggressive hikes at the last three meetings. It was the seventh consecutive rate hike pushing borrowing costs to the highest level since 2008. Notably the BoC Governing Council dropped “expects that the policy interest rate will need to rise further” to … Continue reading “Bank of Canada Hikes Rates 50 bps to Highest Level Since 2008”