Central Bank Watch – Confronting Fed, Bank of England and Swiss National Bank Meetings Ahead

It’s been a week since the implosion of three US banks, Silicon Valley Bank, Signature Bank and Silvergate Capital Corp. From there we saw further selling of Credit Suisse that has never recovered from Archegos and the panic selling and speculative attacks on other US Regional banks. The Federal Reserve has worked in concert with the Treasury and major money center banks to stabilize conditions. The speed of protective measures for the financial system has been impressive but with that … Continue reading “Central Bank Watch – Confronting Fed, Bank of England and Swiss National Bank Meetings Ahead”

Central Bank Watch – Systemic Risk and The Federal Reserve

It will be a busy week for central bankers and investors alike. Up front is the risk of contagion in the financial sector from the two bank failures, Silicon Valley Bank and Silvergate Capital Corp. We have the backdrop of a more hawkish Fed Chair in the face of escalating systemic risk. How will this affect Fed policy given the massive treasury positions out there and the risk of uninsured funds? Ahead the ECB and the Bank of Indonesia will … Continue reading “Central Bank Watch – Systemic Risk and The Federal Reserve”

Central Bank Watch – RBA, BoC, BoJ Rates; Federal Reserve Chair Powell Semi Annual Testimony

Central bankers continued their hawkish tilt for the most part all week. Though Fed’s Bostic gave the stock and bond markets relief when he said he’s firmly in the 25bps camp for rate hike pace (as opposed to 50bps). There were no major Central Bank decisions. The Pakistan Central Bank (SBP) hiked 300bps to 20% saying the IMF required the rate hike to get funding released. Emerging markets are caught in a never-ending loop brought to you by their bankers. … Continue reading “Central Bank Watch – RBA, BoC, BoJ Rates; Federal Reserve Chair Powell Semi Annual Testimony”

Central Bank Watch – Will Hawks Continue to Push Rates Aggressively?

With the markets rattled by inflation concerns as Central bankers continued with the higher for mantra we had the FOMC Meeting minutes without any surprises and speeches by Fed officials. Surprisingly though, St. Louis Fed President Bullard (not an FOMC voter), who is generally more hawkish after the hotter than expected core-PCE Price Index was released, remarked that “it appears that the Fed may be able to disinflate in an orderly manner and achieve a relatively soft landing.”  The Reserve … Continue reading “Central Bank Watch – Will Hawks Continue to Push Rates Aggressively?”

Central Bank Watch – Fed Hawks, South Korea, New Zealand and Turkey Ahead

Central bankers this week were on a higher for longer mantra. We also saw another big career switch with Vice Chair Brainard heading to the White house and Chicago Fed President Goolsbee is being considered to replace Lael Brainard as Fed Vice Chair, according to The Wall Street Journal. Bank Indonesia held its key rate at 5.75% while Bangko Sentral ng Pilipinas announced a 50 bps rate hike to 6.00%. We had a slew of Fed speakers comment on rates, with … Continue reading “Central Bank Watch – Fed Hawks, South Korea, New Zealand and Turkey Ahead”

Central Bank Watch – Eyes on Fed Speakers and CPI

For the most part no surprises from central banks this past week. We got rate hikes as expected from Australia, India, and Sweden. However, Banco de México raised interest rates by 50 basis points rather than the expected 25bps as January inflation accelerated for the second straight month. Peru’s BCRP surprised by holding its policy rate unchanged at 7.75% instead of a 25bps hike. The most significant chatter on central bank watch is around the next BoJ boss. We have … Continue reading “Central Bank Watch – Eyes on Fed Speakers and CPI”

Reserve Bank of India Hike Rates Sixth Time in a Row to 6.50%

The Reserve Bank of India on Wednesday raised its key repo rate by 25 bps to 6.50% during its February meeting, the sixth-rate hike in a row. Headline Consumer Price Inflation (CPI) remains under the RBI’s upper tolerance limit of 6 per cent. There has been some moderation in food prices with annual inflation easing unexpectedly easing to 5.72% in December of 2022 from 5.88% in November, the lowest reading since December of 2021. With the US dollar pulling back … Continue reading “Reserve Bank of India Hike Rates Sixth Time in a Row to 6.50%”

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

Central banks responded as expected this past week which gave relief to stock and bond markets. The big three central banks, the Federal Reserve (Fed), Bank of England (BOE) and European Central Bank (ECB) all delivered more rate hikes as expected. The Banco Central do Brasil as expected kept the Selic rate at 13.75% which is where it has been since last August. The Hong Kong Monetary Authority (HKMA), Hong Kong’s de-facto central bank, raised its benchmark interest rate, following the … Continue reading “Central Bank Watch – The Big Three Fed, ECB and BoE All Raise Rates Again”

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”

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”