Wednesday, September 17, 2014

Thailand holds rate, accommodative stance still needed

    Thailand's central bank maintained its policy rate at 2.0 percent, as expected, saying the "current degree of monetary accommodation is still needed given an early stage of recovery, and does not pose risks to financial stability."
    The Bank of Thailand (BOT), which cut its rate by 25 basis points in March, added that its monetary policy committee had unanimously agreed on the decision though two of its members did not attend the meeting.
    The BOT said domestic demand is being shored up by improving private confidence and a rebound in private and public spending and this should help sustain economic momentum while tourism has slowly started to recover and inflation remains stable.
    Nevertheless, low agricultural prices and supply-side limitations have affected exports, it added.
    It was the third unanimous monetary policy decision by the BOT since the coup by the Thai army on May 22.  Economists had widely expected the central bank to maintain rates as the economy is starting to heal after many months of political and social unrest prior to the army's coup.
    Thailand's core inflation rate rose marginally to 1.83 percent in August from 1.81 percent in July, within the BOT's target of 0.5 to 3.0 percent core inflation. Headline inflation in August eased to 2.09 percent from 2.16 percent.

    www.CentralBankNews.info

Tuesday, September 16, 2014

Central Bank News Link List - Sep 16, 2014 - ECB’s predicament leaves peers mute on currency depreciation

Here's today's Central Bank News' link list, click through if you missed the previous link list. The list comprises news about central banks that is not covered by Central Bank News. The list is updated during the day with the latest developments so readers don't miss any important news.


Monday, September 15, 2014

Central Bank News Link List - Sep 15, 2014 - OECD slashes growth forecasts, urges aggressive ECB action

Here's today's Central Bank News' link list, click through if you missed the previous link list. The list comprises news about central banks that is not covered by Central Bank News. The list is updated during the day with the latest developments so readers don't miss any important news.

          www.CentralBankNews.info


Mozambique maintains rate on low inflation

    Mozambique's central bank held its benchmark standing facility rate steady at 8.25 percent, noting the positive behavior of inflation in August as well short- and medium-term projections that are improving the prospects for inflation to meet the 6.0 percent target for the end of 2014.
    The Bank of Mozambique, which has maintained its rate since October 2013, also took note of the risks of slowing global economic activity, volatility in international commodity prices that reflect the conflicts in Ukraine, Libya and the Middle East.
    Mozambique's inflation rate eased to 2.64 percent in August from 2.95 percent in July, with low inflation in the last eight months due to increased supply of domestic fruit, vegetables and plants during the cool season along with the stability of the exchange rate of the metical currency that is supported by the greater availability of foreign exchange.
    As of Aug. 31, the central bank said the metical was quoted at 30.51 to the U.S. dollar, an appreciation of 0.03 percent during last month, cumulative appreciation of 1.87 percent and annual increase of 2.21 percent.
    Mozambique's Net International Reserves rose by US$ 4 million in August to $3.24 billion on the last day of August, representing 4.5 months of imports.

    www.CentralBankNews.info


 

This week in monetary policy: Mozambique, U.S., Thailand, Malaysia, Norway, Switzerland, South Africa and Nigeria

    This week (Sept. 15-19) eight central banks are scheduled to decide on monetary policy: Mozambique, the United States, Thailand, Malaysia, Norway, Switzerland, South Africa and Nigeria.
    Following table includes name of the country, its MSCI classification, the date the policy decision will be announced, the current policy rate, and the rate one year ago.

COUNTRY MSCI              DATE  CURRENT  RATE         1 YEAR AGO
MOZAMBIQUE 8.25% 8.25% 8.75%
UNITED STATES DM 17-Sep 0.25% 0.25%
THAILAND EM 17-Sep 2.00% 2.50%
MALAYSIA EM 18-Sep 3.25% 3.00%
NORWAY DM 18-Sep 1.50% 1.50%
SWITZERLAND DM 18-Sep 0.25% 0.25%
SOUTH AFRICA EM 18-Sep 5.75% 5.00%
NIGERIA FM 19-Sep 12.00% 12.00%

www.CentralBankNews.info

Monetary Policy Week in Review – Sep 8-12, 2014: Chile, Peru continue easing, Philippines ratchets up further

    Last week in global monetary policy the central banks of Chile and Peru continued their easing cycles while the Philippines ratcheted up rates further as geopolitical tensions, including the possible independence of Scotland, dominated sentiment in financial markets.
    Amid the growing prospects of armed intervention by an international coalition in Syria and Iraq, there was uplifting news from the euro area where finance ministers last Friday showed their willingness to support the European Central Bank’s (ECB) plea for fiscal stimulus and structural reforms to help stimulate demand now that its rates are at rock bottom and asset purchases over the coming months will help enlarge its balance sheet.
     Through the first 37 weeks of this year, the 90 central banks followed by Central Bank News have cut their policy rates 48 times, or 14.2 percent of all policy decisions, up from 12 percent at the end of the first half and 12 percent at the end of the first quarter.
    Meanwhile, rates have been raised 36 times, or 10.6 percent of all policy decisions, up from 9.3 percent at the end of June and 8.7 percent at the end of March.

LIST OF LAST WEEK’S CENTRAL BANK DECISIONS:

OTHER STORIES:


TABLE WITH LAST WEEK’S MONETARY POLICY DECISIONS:
COUNTRY MSCI      NEW RATE            OLD RATE         1 YEAR AGO
NEW ZEALAND DM 3.50% 3.50% 2.50%
PHILIPPINES EM 4.00% 3.75% 3.50%
INDONESIA EM 7.50% 7.50% 7.25%
SERBIA FM 8.50% 8.50% 11.00%
CHILE EM 3.25% 3.50% 5.00%
PERU EM 3.50% 3.75% 4.25%
SOUTH KOREA EM 2.25% 2.25% 2.50%
RUSSIA EM 8.00% 8.00% 8.25%

    This week (Week 38) seven central banks are scheduled to decide on monetary policy: Mozambique, the United States, Thailand, Malaysia, Norway, Switzerland and South Africa.

COUNTRY MSCI              DATE  CURRENT  RATE         1 YEAR AGO
MOZAMBIQUE 15-Sep 8.25% 8.75%
UNITED STATES DM 17-Sep 0.25% 0.25%
THAILAND EM 17-Sep 2.00% 2.50%
MALAYSIA EM 18-Sep 3.25% 3.00%
NORWAY DM 18-Sep 1.50% 1.50%
SWITZERLAND DM 18-Sep 0.25% 0.25%
SOUTH AFRICA EM 18-Sep 5.75% 5.00%



 



Sunday, September 14, 2014

BIS spotlights home prices as early warning indicator

   House prices in Australia, Belgium and France have declined recently while the rise in Canadian, Norwegian and Swedish home prices has moderated, according to data from the Bank for International Settlements (BIS) that can be used as an early warning indicator for financial instability.
    Encouraged by the Group of 20 finance ministers and central bank governors, BIS has expanded its collection of data on comparable monthly residential property prices to span 55 countries to help policymakers and economists identify whether house prices are sustainable or whether they are exceeding historical averages.
    "Leverage-fuelled housing booms that turn into busts have often been at the very heart of episodes of systemic stress," BIS wrote in its latest quarterly review that includes an article on how the residential price data are collected and can be used.
   "Historical experience has demonstrated that the interactions between rapidly growing house prices and excessive credit expansion are a tell-tale sign of the build-up of vulnerabilities in the household sector and the source of future losses for banks," adds BIS in a reference to earlier work partly by Claudio Borio, the head of its monetary and economic department.

Low volatility due to reduced economic uncertainty - BIS

    The current low level of volatility in financial markets, following a brief rise in July from geopolitical tensions, is partly due to reduced uncertainty about the global economy, according to the Bank for International Settlements (BIS).
    In its latest quarterly review, Swiss-based BIS examined the prolonged calm in financial markets with volatility of bonds, equities, exchange rates and commodity prices well below historical averages in early July and in several cases even below pre-crises levels.
    After a short-lived pickup in volatility in late July and early August, volatility as measured by the VIX volatility index had already dropped back to 12 percent as investor appetite recovered.
    "Volatility is generally lower during business cycle expansions than in recessions, when uncertainty about macroeconomic and firm-specific fundamentals tend to be higher," BIS wrote.
   Exceptionally accommodative monetary policy is likely to have played a role in driving volatility to such exceptional lows, by directly compressing volatility on fixed income markets.
    "More transparent central bank communication, forward guidance and asset purchases have also removed uncertainty about interest rate changes for medium- and longer-term maturities," BIS adds.
    Please click on www.bis.org to read the BIS September quarterly review.

    www.CentralBankNews.info

   

Friday, September 12, 2014

Central Bank News Link List - Sep 12, 2014 - Euro zone: fiscal policy, reforms should compliment ECB loosening

Here's today's Central Bank News' link list, click through if you missed the previous link list. The list comprises news about central banks that is not covered by Central Bank News. The list is updated during the day with the latest developments so readers don't miss any important news.