Monday, September 1, 2014

This week in monetary policy: Egypt, Australia, Brazil, Poland, Canada, Sweden, euro area, U.K. and Mexico

    This week (September 1 - 5) nine central banks are scheduled to decide on monetary policy, including those for the countries and jurisdictions of Egypt (which was originally scheduled last week), Australia, Brazil, Poland, Canada, Sweden, the euro area, the United Kingdom and Mexico.    
    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
EGYPT EM 1-Sep 9.25% 9.25%
AUSTRALIA DM 2-Sep 2.50% 2.50%
BRAZIL EM  3-Sep 11.00% 9.00%
POLAND EM 3-Sep 2.50% 2.50%
CANADA DM 3-Sep 1.00% 1.00%
SWEDEN DM 4-Sep 0.25% 1.00%
EURO AREA 4-Sep 0.15% 0.50%
UNITED KINGDOM DM 4-Sep 0.50% 0.50%
MEXICO EM 5-Sep 3.00% 3.75%


Sunday, August 31, 2014

Monetary Policy Week in Review – Aug 25-29, 2014: Markets mull Draghi as Israel cuts, Colombia raises rates

    Speculation over further monetary easing by the European Central Bank (ECB) dominated global monetary policy last week as financial markets continued to digest the implication of Mario Draghi’s speech in Jackson Hole.
    In his speech on Friday Aug. 22 ECB President Draghi said he will use "all the available instruments needed to ensure price stability" and is "ready to adjust the policy stance further."
    In addition, Draghi went beyond his normal language about the need for fiscal discipline and called on euro area policymakers to loosen the fiscal strings and get serious about structural reforms that can improve the area's global competitiveness.
    Whether Draghi and the ECB will embark on full-blown quantitative easing this week following another decline in inflation in August is one of the major factors that will influence sentiment in global financial markets, increasingly rattled by unsettling news from the Ukraine and the Mideast.
    Underscoring the economic toll from fighting in Gaza, Israel last week cut its policy rate for the third time this year to 0.25 percent in response to slowing economic growth, falling inflation and a decline in its shekel currency.
    Whether the Bank of Israel (BOI) was thinking about the ECB was not clear, but in its statement the BOI predicted continued accommodative monetary policy by major central banks for an extended period of time, a comment that may be prescient given that both the Federal Reserve and the Bank of England are currently shifting toward monetary tightening.
    The Central Bank of Colombia was the only other central bank that changed its rates last week, raising its intervention rate for the fifth consecutive time to curb inflation.
    But the Colombian central bank signaled that it may be getting close to pausing in its tightening cycle, changing its guidance to include the comment that it hopes the latest rate rise would keep inflation expectations close to its 3.0 percent target and economic activity at its potential level.
    The other four central banks that held monetary policy meetings last week maintained their policy rates, including the National Bank of Hungary, which as promised froze rates after 24 consecutive rate reductions.
    And while the Central Bank of the Republic of Turkey maintained its benchmark repo rate at 8.25 percent, it again nudged down its rate corridor by trimming the overnight lending rate – the corridor’s ceiling – by 75 basis points to 11.25 percent while it kept the borrowing rate – the floor – steady at 7.50 percent.

LIST OF LAST WEEK’S CENTRAL BANK DECISIONS:

TABLE WITH LAST WEEK’S MONETARY POLICY DECISIONS:
COUNTRY MSCI      NEW RATE            OLD RATE         1 YEAR AGO
ISRAEL DM 0.25% 0.50% 1.25%
ANGOLA 8.75% 8.75% 9.75%
HUNGARY 2.10% 2.10% 3.80%
TURKEY EM 8.25% 8.25% 4.50%
ALBANIA 2.50% 2.50% 3.50%
COLOMBIA EM 4.50% 4.25% 3.25%

    This week (Week 36) nine central banks are scheduled to decide on monetary policy: Egypt (which was originally scheduled for last week), Australia, Brazil, Poland, Canada, Sweden, the euro area, the United Kingdom and Mexico.

COUNTRY MSCI              DATE  CURRENT  RATE         1 YEAR AGO
EGYPT EM 1-Sep 9.25% 9.25%
AUSTRALIA DM 2-Sep 2.50% 2.50%
BRAZIL EM  3-Sep 11.00% 9.00%
POLAND EM 3-Sep 2.50% 2.50%
CANADA DM 3-Sep 1.00% 1.00%
SWEDEN DM 4-Sep 0.25% 1.00%
EURO AREA 4-Sep 0.15% 0.50%
UNITED KINGDOM DM 4-Sep 0.50% 0.50%
MEXICO EM 5-Sep 3.00% 3.75%




Friday, August 29, 2014

Colombia raises rate for 5th time, may now pause

    Colombia's central bank raised its benchmark intervention rate by 25 basis points for the fifth time in a row but signaled that it may now pause in its tightening cycle by saying it hopes today's rate rise will keep inflation expectations close to the 3.0 percent target and economic activity at its potential level.
    The Central Bank of Colombia has now raised its policy rate by a total of 125 basis points since April to curb inflationary pressures and said the economy was adjusting to the change in its monetary policy stance.
    Colombia's headline inflation rate rose to 2.89 percent in July from 2.79 percent in June, but was below May's 2.93 percent. The central bank said the four core inflation indicators that it monitors had declined for the second consecutive month and reached 2.58 percent.
    The central bank targets inflation at a midpoint of 3.0 percent in a range from 2.0 to 4.0 percent and said the inflation forecast for December and expectations for inflation one year or more were about 3.0 percent.
    Colombia's economy is forecast to expand by about 5.0 percent this year, the bank said, confirming its forecast from July when it raised the projection from a previous 4.3 percent. Last year the economy expanded by 4.7 percent.

Central Bank News Link List - Aug 29, 2014 - Euro inflation slows as Draghi hints at more ECB stimulus

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.


Thursday, August 28, 2014

Angola maintains rates on stable inflation

    Angola's central bank maintained its benchmark BNA rate at 8.75 percent after inflation rose by 0.09 percent in July for an annual rate of 6.98 percent, up from 6.89 percent in June.
    The Bank of Angola (BNA), which raised its rate by 50 basis points last month, said credit to the economy in July was up by an annual 19.5 percent to 3.295 billion kwanza. The BNA raised its rate last month to stimulate growth in credit as inflation is expected to continue to trend downward.
    The BNA also said total sales of foreign currency in the first seven months amounted to $19.858 billion, an increase of 63.33 percent from the same period in 2013.
    The average exchange rate of the kwanza rose by 0.51 percent in July from June for a rate of 97.08 to the U.S. dollar, slightly firmer from the start of the year at 97.61.
    July's rate cut by the BNA was the first change in rates since November 2013 and the central bank also reduced the rate on its standing lending facility by 25 basis points to 9.75 percent.
    Last month the International Monetary Fund (IMF) forecast that Angola's inflation rate would rise to 7.5 percent by the end of the year due to the one-off effects on new tariffs on imports before continuing the downtrend through 2015 and beyond.

Central Bank News Link List - Aug 28, 2014 - Swiss franc hits 21-month high vs euro, triggers SNB intervention talk

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




Egypt pushes back policy meeting to Monday, Sept. 1

    The Central Bank of Egypt (CBE) has changed the date for the meeting of its Monetary Policy Committee to Monday, Sept. 1 from Thursday, Aug. 28.
    The central bank did not provide any reason for the adjustment in a brief statement.
    At its previous meeting on July 17, the CBE surprised financial markets by raising its key interest rates by 100 basis points in a preemptive move to anchor inflation expectations and limit a general increase in prices following the government's price increase on several regulated items, including fuel, electricity and tobacco, as part of its plan to reduce budged deficits.
    Egypt's headline inflation rate jumped to 10.61 percent in July from 8.2 percent and the core inflation rate rose to 9.35 percent from 8.76 percent.
    In addition to raising the benchmark overnight deposit rate by 100 basis points to 9.25 percent, the CBE last month also raise the overnight lending rate to 10.25 percent, the rate on its main operation to 9.75 percent and the discount rate to 9.75 percent.



Wednesday, August 27, 2014