Wednesday, October 31, 2012
OTC infrastructure ready, but no regulatory certainty - FSB
The private sector infrastructure necessary to trade, clear and record over-the-counter (OTC) derivative transactions is now ready but regulatory uncertainty is blocking everyone from using these new exchanges, according to the Financial Stability Board (FSB).
The FSB’s fourth progress report on reforming OTC derivatives, which triggered fears of contagion during the global financial crises, showed that the United States, the European Union, Hong Kong and Japan have made further progress in meeting the goal of trading and clearing through central counter parties by end-2012.
But agreeing on cross-border rules is lacking and the FSB urged regulators worldwide to identify and develop options to tackle the shortcomings to help meet the end-2012 commitment to central clearing.
The financial crises revealed that OTC derivatives had contributed to the build-up of systemic risk and the global nature of these markets - where buyers and sellers are frequently located in different jurisdictions - makes globally consistent regulation essential.
Central Bank News Link List - Oct. 31, 2012: ECB reports 'pronounced' fall in demand for loans
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.
- Eurozone central bank reports 'pronounced' fall in demand for loans (AP/Washington Post)
- Peru's central bank tightens reserve requirements for fourth time this year (Reuters)
- Zambia c.bank lifts policy rate 25 bps to 9.25 pct (Reuters)
- MF Global's collapse: The Fed's role (The Exchange)
- Bank of Canada repeats rate message, sees debt slowing (Reuters)
- Kocherlakota defends Fed's monetary policy (Reuters)
- Why India's central bank resisted pressure to ease (CNBC)
- Kenya, Uganda inflation falls point to more rate cuts (Reuters)
- Ex-BOJ's Sekido says central bank commitment signals more easing (Bloomberg)
- Mexico's Carstens ready to act if inflation keeps rising (Reuters)
- SNB (Swiss) posts 9-month profit, cuts euro holdings (Reuters)
- Hong Kong intervenes for peg for fifth time in two weeks (Bloomberg)
- Analysts: BNM (Malaysia) likely to hold policy rate (the sun daily)
- Finalists emerge for Britain's central bank job (WSJ))
- www.CentralBankNews.info
Norway keeps rate at 1.5%, delays expected rise until 2013
Norway's central bank kept its policy rate unchanged at 1.5 percent, as widely expected, and delayed an increase in the rate to sometime next year.
Norges Bank, which has cut rates twice this year, said in a statement that it was keeping its rate on hold due to low inflation and low interest rates worldwide.
"Developments in the Norwegian economy give reason to believe that inflation will gradually pick up," the bank said in a statement, quoting Governor Oeystein Olsen.
"The analysis in this report suggests that the key policy rate should be kept at today's level into next year, followed by a gradual increase towards a more normal level. The forecast for the key policy rate in 2013 is slightly lower than in the June forecast," he added.
In its June Monetary Policy Report, the bank had forecast an increase in the policy rate by the end of this year. But at its last meeting in August, the bank said it was starting to postpone the rate rise, saying the upward shift in interest rates had been deferred, though it did not specify until when.
Norges Bank, which has cut rates twice this year, said in a statement that it was keeping its rate on hold due to low inflation and low interest rates worldwide.
"Developments in the Norwegian economy give reason to believe that inflation will gradually pick up," the bank said in a statement, quoting Governor Oeystein Olsen.
"The analysis in this report suggests that the key policy rate should be kept at today's level into next year, followed by a gradual increase towards a more normal level. The forecast for the key policy rate in 2013 is slightly lower than in the June forecast," he added.
In its June Monetary Policy Report, the bank had forecast an increase in the policy rate by the end of this year. But at its last meeting in August, the bank said it was starting to postpone the rate rise, saying the upward shift in interest rates had been deferred, though it did not specify until when.
Tuesday, October 30, 2012
Hungary to consider further rate cuts, sees lower inflation
Hungary's central bank, which earlier announced its third interest rate cut in a row, said weak domestic demand will soon restrain inflation and the bank will consider further interest rate cuts if financial market sentiment remains healthy and the inflation outlook remains stable.
The Magyar Nemzeti Bank, which has cut its base rate by 75 basis points so far this year to 6.25 percent, said Hungary's economy was in recession and weak corporate investment and persistently high unemployment suggests that the economy's potential is "significantly below its pre-crises level."
With a "substantial margin of spare capacity in the economy," the central bank said cost shocks hitting have "no adverse effect on the medium-term outlook for inflation, and the disinflationary impact of weak domestic demand will dominate as the effects of cost shocks wane."
"The Council will consider a further reduction in interest rates if data becoming available in the coming months confirm that the improvement in financial market sentiment persists and the medium-term outlook for inflation remains consistent with the 3 percent target," the bank said in a statement.
The Magyar Nemzeti Bank, which has cut its base rate by 75 basis points so far this year to 6.25 percent, said Hungary's economy was in recession and weak corporate investment and persistently high unemployment suggests that the economy's potential is "significantly below its pre-crises level."
With a "substantial margin of spare capacity in the economy," the central bank said cost shocks hitting have "no adverse effect on the medium-term outlook for inflation, and the disinflationary impact of weak domestic demand will dominate as the effects of cost shocks wane."
"The Council will consider a further reduction in interest rates if data becoming available in the coming months confirm that the improvement in financial market sentiment persists and the medium-term outlook for inflation remains consistent with the 3 percent target," the bank said in a statement.
Hungary cuts rate by 25 bps for third month in a row
Hungary's central bank cut its base rate for the third month in a row by 25 basis points to 6.25 percent, a move that was expected by some economists.
The Magyar Nemzeti Bank said in brief statement that the new two-week deposit rate would take effect on Oct. 31. The overnight central bank deposit rate will be 5.25 percent and the rate on overnight collateralised loans will be 7.25 percent.
The central bank will issue a statement later, explaining its policy decision.
The central bank has been cutting rates this year, so far by 75 basis points, despite a rise in inflation to fight of recession.
The inflation rate rose to 6.6 percent in September, the highest since mid-2008, from 6.0 percent in August. The central bank targets inflation of 3 percent.
But Hungary's economy contracted by 0.2 percent in the second quarter from the first, following a quarterly contraction of 1.04 percent in the first quarter, leaving the year-on-year contraction of 1.3 percent in the second quarter.
Last month the central bank said it expected inflation to remain above 3 percent for some time and only decline to its target in the second half of 2014.
www.CentralBankNews.info
The Magyar Nemzeti Bank said in brief statement that the new two-week deposit rate would take effect on Oct. 31. The overnight central bank deposit rate will be 5.25 percent and the rate on overnight collateralised loans will be 7.25 percent.
The central bank will issue a statement later, explaining its policy decision.
The central bank has been cutting rates this year, so far by 75 basis points, despite a rise in inflation to fight of recession.
The inflation rate rose to 6.6 percent in September, the highest since mid-2008, from 6.0 percent in August. The central bank targets inflation of 3 percent.
But Hungary's economy contracted by 0.2 percent in the second quarter from the first, following a quarterly contraction of 1.04 percent in the first quarter, leaving the year-on-year contraction of 1.3 percent in the second quarter.
Last month the central bank said it expected inflation to remain above 3 percent for some time and only decline to its target in the second half of 2014.
www.CentralBankNews.info
Central Bank News Link List - Oct. 30, 2012: China money rates fall after record PBOC cash injection
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.
- China money rates fall after record PBOC cash injection (Reuters)
- Japan joint statement hints at tighter grip on monetary policy (WSJ)
- Spain's bad bank lures investors with steep discounts (Reuters)
- UBS to cut 10,000 jobs in fixed income retreat (Reuters)
- After Hurricane Sandy, stock exchanges prepare to open (NYT)
- RBA deputy governor hints at lower rates (ninemsn)
- Singapore's central bank sees below potential GDP growth (RTT)
- Broadbent says BOE should keep inflation targeting (Bloomberg)
- Canada budget office see rates on hold through first quarter of 2015 (Reuters)
- Barclays Libor case to go to trial (Reuters)
- SBP (Pakistan) likely to bring interest rate in single digit in upcoming policy (online news)
- www.CentralBankNews.info
Japan boosts asset purchase program to 91 trillion yen
The Bank of Japan (BOJ) expanded its asset purchase program by another 11 trillion yen to 91 trillion, slightly more than expected by many economists, and set up a new framework, with unlimited funds, in an attempt to stimulate bank lending.
The BOJ also kept its overnight call rate unchanged at zero to 0.1 percent, the level it has been at since December 2008,
Under the increased asset purchase program, the BOJ will purchase some 10 trillion yen in Japanese government bonds and Treasury bills, 0.1 trillion in commercial paper, 0.3 trillion in corporate bonds, 0.5 trillion in exchange traded funds and 0.01 trillion in Japanese real estate investment trusts.
The BOJ intends to complete the increased purchases by around the end of 2013.
Last month the BOJ expanded the asset purchase program by 10 trillion yen to 80 trillion.
Under the new framework to stimulate bank lending - the Stimulating Bank Lending Facility - the BOJ said in a statement that it would provide long-term funds of up to the banks' net increase in lending at a low interest rate, currently at 0.1 percent, to promote an "aggressive action and helping increase proactive credit demand of firms and households."
"There shall be no upper limit - unlimited - to the total amount of funds provided by the Bank under this facility," the BOJ added.
The BOJ also kept its overnight call rate unchanged at zero to 0.1 percent, the level it has been at since December 2008,
Under the increased asset purchase program, the BOJ will purchase some 10 trillion yen in Japanese government bonds and Treasury bills, 0.1 trillion in commercial paper, 0.3 trillion in corporate bonds, 0.5 trillion in exchange traded funds and 0.01 trillion in Japanese real estate investment trusts.
The BOJ intends to complete the increased purchases by around the end of 2013.
Last month the BOJ expanded the asset purchase program by 10 trillion yen to 80 trillion.
Under the new framework to stimulate bank lending - the Stimulating Bank Lending Facility - the BOJ said in a statement that it would provide long-term funds of up to the banks' net increase in lending at a low interest rate, currently at 0.1 percent, to promote an "aggressive action and helping increase proactive credit demand of firms and households."
"There shall be no upper limit - unlimited - to the total amount of funds provided by the Bank under this facility," the BOJ added.
Monday, October 29, 2012
India holds rate, cuts CCR by 25 bps, sees further easing
India's central bank held its benchmark repurchase rate steady at 8.0 percent but cut its Cash Reserve Ratio (CCR) by 25 basis points to 4.25 percent, and held out the promise of further policy easing in the fourth quarter of the 2012/13 year.
The Reserve Bank of India (RBI), which also cut its CCR by 25 basis points last month, said in a statement that the reduction in CCR would inject some 175 billion rupees into the banking system, and was "intended to pre-empt a prospective tightening of liquidity conditions, thereby keeping liquidity comfortable to support growth."
The RBI said it expects inflation to rise further and then ease in the last quarter.
"While risks to this trajectory remain, the baseline scenario suggests a reasonable likelihood of further policy easing in the fourth quarter of 2012-13," it said, adding that further easing would also be "conditioned by the evolving growth-inflation dynamic."
The cut in the CCR - the percentage of deposits that banks keep with the central bank - was expected by many economists while some had also been looking to the RBI to cut its repo rate.
The Reserve Bank of India (RBI), which also cut its CCR by 25 basis points last month, said in a statement that the reduction in CCR would inject some 175 billion rupees into the banking system, and was "intended to pre-empt a prospective tightening of liquidity conditions, thereby keeping liquidity comfortable to support growth."
The RBI said it expects inflation to rise further and then ease in the last quarter.
"While risks to this trajectory remain, the baseline scenario suggests a reasonable likelihood of further policy easing in the fourth quarter of 2012-13," it said, adding that further easing would also be "conditioned by the evolving growth-inflation dynamic."
The cut in the CCR - the percentage of deposits that banks keep with the central bank - was expected by many economists while some had also been looking to the RBI to cut its repo rate.
The RBI said risks to global growth had risen and could well overwhelm to positive effects of enhanced liquidity by central banks in advanced economies.
Task force issues 7 disclosure principles for banks
A task force comprised of bankers, investors, analysts, auditors and credit ratings’ officers has issued seven principles that should make it easier for shareholders to grasp the risks posed by banks and help restore their trust in the financial industry.
The principles from the Enhanced Disclosure Task Force (EDTF), which was formed in May at the initiative of the Financial Stability Board (FSB), is different from recommendations by banking regulators because they arise from discussions between users and prepares of financial reports.
“These principles provide a firm foundation for developing high-quality, transparent disclosures that clearly communicate banks’ business models and the key risks that arise from them,” said the report, co-chaired by Hugo Baenziger, supervisory board chairman of Eurex, Russell Picot, group general manager of HSBC, and Christian Stracke, managing director of Pimco.
The principles are mainly aimed at improving risk disclosure by large international banks, but should also be applicable to all banks that access equity and debt markets.
Israel cuts rate 25 bps to 2.0% to bolster growth
The central bank of Israel cut its policy interest rate by 25 basis points to 2.0 percent, its third rate cut this year, to bolster economic growth while inflation has eased to the midpoint of the bank's target.
But to restrain the growth in housing credit, the Bank of Israel (BoI) limited the loan-to-value ratios to keep home prices from raising too fast.
The BoI, which has cut rates by a total of 75 basis points this year, said Europe's debt crises continues to be the main risk to the global economy and recent data showed that growth in Israel's economy had moderated to a rate of around 3 percent, in line with the bank's forecast from last month of Gross Domestic Product growth of 3.3 percent this year and 3.0 percent in 2013.
"Against the background of the debt crisis in Europe, the level of economic risk from around the world remains high, and with it the concerns over negative effects on the local economy," the BoI said in a statement.
In the second quarter, Israel's economy expanded by 3.10 percent annual rate while the September annual inflation rate rose to 2.1 percent from 1.9 percent. The BoI targets inflation of 1-3 percent.
www.CentralBankNews.info
But to restrain the growth in housing credit, the Bank of Israel (BoI) limited the loan-to-value ratios to keep home prices from raising too fast.
The BoI, which has cut rates by a total of 75 basis points this year, said Europe's debt crises continues to be the main risk to the global economy and recent data showed that growth in Israel's economy had moderated to a rate of around 3 percent, in line with the bank's forecast from last month of Gross Domestic Product growth of 3.3 percent this year and 3.0 percent in 2013.
"Against the background of the debt crisis in Europe, the level of economic risk from around the world remains high, and with it the concerns over negative effects on the local economy," the BoI said in a statement.
In the second quarter, Israel's economy expanded by 3.10 percent annual rate while the September annual inflation rate rose to 2.1 percent from 1.9 percent. The BoI targets inflation of 1-3 percent.
www.CentralBankNews.info
Angola keeps rate on hold, fx and interest rates stable
The central bank of Angola kept its base rate unchanged at 10.25 percent, saying the exchange rate and interest rates have been stable in the last month.
Angola's annual inflation rate eased to 9.65 percent in September, the lowest level so far this year, from 9.87 percent in August. The decline of inflation to a single-digit level has been an aim of Banco Nacional de Angola for many years.
The central bank last cut its interest rate by 25 basis points in January, but earlier this month the bank's governor said in a speech that a sudden cut in the bank rate would not improve credit to the economy, nor help contain inflation.
The bank said credit extended to the economy increased by 2.6 percent in September for an increase of 17.19 percent since the beginning of this year. Interest rates were also stable last month with overnight LUIBOR at 5.40 percent annually, the bank said.
The average exchange rate of the kwanza currency against the U.S. dollar was 95.42 at the end of September "reflecting the stability observed since the beginning of the year," the bank added.
www.CentralBankNews.info
Angola's annual inflation rate eased to 9.65 percent in September, the lowest level so far this year, from 9.87 percent in August. The decline of inflation to a single-digit level has been an aim of Banco Nacional de Angola for many years.
The central bank last cut its interest rate by 25 basis points in January, but earlier this month the bank's governor said in a speech that a sudden cut in the bank rate would not improve credit to the economy, nor help contain inflation.
The bank said credit extended to the economy increased by 2.6 percent in September for an increase of 17.19 percent since the beginning of this year. Interest rates were also stable last month with overnight LUIBOR at 5.40 percent annually, the bank said.
The average exchange rate of the kwanza currency against the U.S. dollar was 95.42 at the end of September "reflecting the stability observed since the beginning of the year," the bank added.
www.CentralBankNews.info
Central Bank News Link List - Oct. 29, 2012: BOJ reportedly eyeing further monetary easing
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.
- BOJ reportedly eyeing further monetary easing (Kyodo/Japan Times)
- Bracing for storm, U.S. stock markets to close (NYT)
- RBA moves to limit gains in Aussie dollar (Australian Financial Review)
- ECB Draghi: High rates most effective in ensuring reforms (MNI)
- RBI may cut repo rate by 25 bps in next monetary policy meeting (Business Standard)
- Carstens says Mexico bank sent stronger message on inflation (Bloomberg)
- Spain's banks cut sovereign debt holdings for first time since May (Reuters)
- Bank of England's handling of financial crises to be scrutinised in reports (Guardian)
- ECB couldn't participate in Greek haircut: Nowotny (Reuters)
- Taiwan central bank: PBOC likely name yuan clearing bank in Taiwan (WSJ)
- BOE's Bean cautions final-quarter growth may be weak (Bloomberg)
- Slow euro growth worries BoZ (Zambia Daily Mail)
- Does the Fed favor Republican presidents? (The Atlantic)
- www.CentralBankNews.info
Saturday, October 27, 2012
Monetary Policy Week in Review – Oct. 27, 2012: Rates mainly on hold as uncertainty prevails, glimmer of hope
The past week in monetary policy saw interest rate decisions by 12
central banks, with only the Philippines cutting its rate, as expected,
while the remaining 11 central banks (Sri Lanka, Canada, Botswana, United States, Namibia, Georgia, New Zealand, Sweden, Mexico, Trinidad & Tobago and Colombia) held interest rates unchanged.
One message from this week’s decisions by central banks was that global inflation remains largely under control even though some countries are concerned over too low a rate (Sweden and Georgia) while others, such as Mexico, are fighting to restrain inflationary expectations.
Another message, illustrated by 11 of 12 banks keeping rates on hold, was the high degree of uncertainty that surrounds the global economic outlook, mainly due to the political decisions around Europe’s debt problems and the fiscal adjustment in the United States.
Despite this shadow of uncertainty, it was noted by several banks that easier monetary policy in recent months had improved financial market sentiment and, as New Zealand said, made the risks to the global outlook more balanced. Other central banks, such as Colombia’s, said interest rates in many countries are expected to remain low for a while, helping global economic prospects, and there was already signs of a stabilization in the slowdown of major emerging economies.
A less pessimistic mood was also noted in Namibia’s statement, which saw signs of improvement in its trading partners in the next 6-9 months.
The Bank of Canada, which
prides itself of transparency and clear communication, was in the unusual
situation of giving a mixed message to markets. A slight change to its forward
guidance statement, plus recent statements by the bank’s governor, left
economists scratching their heads as to whether the bank had turned more or
less hawkish.
By the end of the week, however,
it was clear that the bank’s basic stance hadn’t fundamentally changed and it
was still trying to strike the right balance between weak global growth and a
healthy domestic economy where many debt-laden households will encounter
hardship when interest rates eventually start rising.
LAST WEEK'S MONETARY POLICY DECISIONS:
| COUNTRY | MSCI | NEW RATE | OLD RATE | RATE 1 YEAR AGO |
| SRI LANKA | FM | 7.75% | 7.75% | 7.00% |
| CANADA | DM | 1.00% | 1.00% | 1.00% |
| BOTSWANA | 9.50% | 9.50% | 9.50% | |
| UNITED STATES | DM | 0.25% | 0.25% | 0.25% |
| NAMIBIA | 5.50% | 5.50% | 6.00% | |
| GEORGIA | 5.75% | 5.75% | 7.25% | |
| NEW ZEALAND | DM | 2.50% | 2.50% | 2.50% |
| SWEDEN | 1.25% | 1.25% | 2.00% | |
| PHILIPPINES | EM | 3.50% | 3.75% | 4.50% |
| MEXICO | EM | 4.50% | 4.50% | 4.50% |
| TRINIDAD & TOBAGO | 2.75% | 2.75% | 3.00% | |
| COLOMBIA | EM | 4.75% | 4.75% | 4.50% |
NEXT WEEK (week 44) features policy meetings by eight central banks,
including heavyweights Japan and India.
| COUNTRY | MSCI | DECISION | CURRENT RATE | RATE 1 YEAR AGO |
| ANGOLA | 29-Oct | 10.25% | 10.50% | |
| JAPAN | DM | 30-Oct | 0.10% | 0.10% |
| INDIA | EM | 30-Oct | 8.00% | 8.50% |
| HUNGARY | EM | 30-Oct | 6.50% | 6.00% |
| NORWAY | DM | 31-Oct | 1.50% | 2.25% |
| CZECH REPUBLIC | EM | 1-Nov | 0.25% | 0.75% |
| ROMANIA | FM | 2-Nov | 5.25% | 6.25% |
| UGANDA | 2-Nov | 13.00% | 20.00% |
www.CentralBankNews.info
Friday, October 26, 2012
Trinidad & Tobago holds rate as inflation pressures ease
The Central bank of Trinidad & Tobago held its repurchase rate unchanged at 2.75 percent, with inflationary pressures easing slightly while business confidence has been weakened by uncertainty over Europe's debt issues and the impending fiscal cliff in the United States.
The central bank added that it would allow last month's 25 basis point cut in its interest rate to work its way through the banking system.
Headline annual inflation, based on retail prices, slowed to 7.7 percent in September from 7.9 percent in August, though on a monthly basis prices rose by 1.1 percent. The main reason for the decline in annual inflation was lower food prices, the bank said.
The core inflation rate, which excludes food, rose marginally to 2.8 percent in September from 2.7 percent, and the bank said credit growth remained modest while consumer lending, which had been "quite lethargic over the past two months" picked up momentum, rising 2.2 percent annually in August.
"Concerns about the Euro area and the impending fiscal cliff in the US have tempered expectations about a sustained global recovery and affected business confidence worldwide, including in Trinidad & Tobago," the central bank said.
www.CentralBankNews.info
The central bank added that it would allow last month's 25 basis point cut in its interest rate to work its way through the banking system.
Headline annual inflation, based on retail prices, slowed to 7.7 percent in September from 7.9 percent in August, though on a monthly basis prices rose by 1.1 percent. The main reason for the decline in annual inflation was lower food prices, the bank said.
The core inflation rate, which excludes food, rose marginally to 2.8 percent in September from 2.7 percent, and the bank said credit growth remained modest while consumer lending, which had been "quite lethargic over the past two months" picked up momentum, rising 2.2 percent annually in August.
"Concerns about the Euro area and the impending fiscal cliff in the US have tempered expectations about a sustained global recovery and affected business confidence worldwide, including in Trinidad & Tobago," the central bank said.
www.CentralBankNews.info
Colombia holds rate, economy growing, inflation on target
Colombia's central bank kept its benchmark intervention rate unchanged at 4.75 percent, as expected, with the economy continuing to expand and inflation very close to the midpoint of the central bank's target range.
Banco de la Republica said the global economy remains weak, but the slowdown in some of the larger emerging economies appears to be stabilizing and it expects interest rates in other countries to be kept low for an extended period.
The Colombian central bank has cut rates twice this year, in July and August, after raising rates in January and February, leaving rates at their end-2011 level.
The weak global economy has been reflected in Colombia's exports and industrial output, but the central bank expects the economic expansion to continue in coming quarters, driven by domestic demand as households remain confident, the labor market strong and the financial system healthy.
"However, the uncertainty associated with the problems of public finances and banks in some advanced economies remains high," the bank said, adding:
"The biggest threat to the country's economic activity continues to be a severe recession in Europe."
Banco de la Republica said the global economy remains weak, but the slowdown in some of the larger emerging economies appears to be stabilizing and it expects interest rates in other countries to be kept low for an extended period.
The Colombian central bank has cut rates twice this year, in July and August, after raising rates in January and February, leaving rates at their end-2011 level.
The weak global economy has been reflected in Colombia's exports and industrial output, but the central bank expects the economic expansion to continue in coming quarters, driven by domestic demand as households remain confident, the labor market strong and the financial system healthy.
"However, the uncertainty associated with the problems of public finances and banks in some advanced economies remains high," the bank said, adding:
"The biggest threat to the country's economic activity continues to be a severe recession in Europe."
Central Bank News Link List - Oct. 26, 2012: Yuan stuck at record high; central bank brakes rapid acceleration
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.
- Yuan stuck at record high; central bank brakes rapid acceleration (Reuters)
- Pressure on BOJ to act mounts as deflation persists (Reuters)
- Colombia likely to keep 4.75% rate as global risk seen abating (Bloomberg)
- Brazil central bank says 'recovery is underway' and inflation is 'under control' (Mercopress)
- Subbarao meets FM ahead of RBI's policy review (zee news)
- Fed's Lacker says new bond buying won't work and risks inflation (Bloomberg))
- Bets raised on pre-2015 Fed rate move (WSJ)
- CNB (Czech) to cut to zero and more to come (FXstreet)
- www.CentralBankNews.info
Mexico holds rate, but warns of hike if inflation rises again
Mexico's central bank held its benchmark interest rate unchanged at 4.50 percent, betting that inflation has peaked, but warned that it would quickly raise interest rates if there was another spike in inflationary pressure, even if it were temporary.
Banco de Mexico, which also warned last month that it may have to raise rates if inflationary pressures grew, said downside risks to the global economy continued to rise and lower economic activity worldwide and an expected fall in commodity prices should lead to a further loosening of monetary policy in many advanced and emerging economies.
Mexico's inflation rate eased slightly in early October to an annual rate of 4.6 percent, the national statistics agency said this week, fanning hopes in financial markets that inflation had peaked and the central bank would keep rates on hold today.
In September inflation hit a rate of 4.8 percent, up from 4.6 in August and the highest level in 2-1/2 years. It was the fourth month in a row that inflation exceeded the central bank's target ceiling.
Banco de Mexico targets inflation of 3 percent, plus/minus one percentage point and has left its target for the overnight interbank rate unchanged since July 2009.
Banco de Mexico, which also warned last month that it may have to raise rates if inflationary pressures grew, said downside risks to the global economy continued to rise and lower economic activity worldwide and an expected fall in commodity prices should lead to a further loosening of monetary policy in many advanced and emerging economies.
Mexico's inflation rate eased slightly in early October to an annual rate of 4.6 percent, the national statistics agency said this week, fanning hopes in financial markets that inflation had peaked and the central bank would keep rates on hold today.
In September inflation hit a rate of 4.8 percent, up from 4.6 in August and the highest level in 2-1/2 years. It was the fourth month in a row that inflation exceeded the central bank's target ceiling.
Banco de Mexico targets inflation of 3 percent, plus/minus one percentage point and has left its target for the overnight interbank rate unchanged since July 2009.
Thursday, October 25, 2012
Philippines cuts rate 25 bps to 3.5% on 'benign' inflation
The central bank of the Philippines cut its key policy rate by 25 basis points to 3.50 percent, as expected by many economists, as low inflation gave Bangko Sentral ng Pilipinas (BSP) room to strengthen domestic activity while global economic prospects continue face considerable headwinds.
BSP described the inflationary environment as "benign," saying forecasts indicate that inflation will remain on target from this year to 2014 and the risks to inflation are balanced.
The central bank has now cut the rate on its key overnight borrowing, or reverse purchase facility, four times this year for a total reduction of 100 basis points. The overnight lending rate was also cut by 25 basis points to 5.50 percent.
The Philippine inflation rate eased to 3.6 percent in September from 3.8 percent and the BSP targets annual inflation of 3-5 percent.
The central bank said it would closely monitor future price and output conditions, but did not give any further signal about the future move in interest rates.
The Philippine economy expanded by an annual 5.9 percent in the second quarter, down from 6.4 percent in the first, and the central bank said the domestic economy remained strong, but "additional policy support could help ward off the risks associated with weaker external demand by encouraging investment and consumption."
BSP described the inflationary environment as "benign," saying forecasts indicate that inflation will remain on target from this year to 2014 and the risks to inflation are balanced.
The central bank has now cut the rate on its key overnight borrowing, or reverse purchase facility, four times this year for a total reduction of 100 basis points. The overnight lending rate was also cut by 25 basis points to 5.50 percent.
The Philippine inflation rate eased to 3.6 percent in September from 3.8 percent and the BSP targets annual inflation of 3-5 percent.
The central bank said it would closely monitor future price and output conditions, but did not give any further signal about the future move in interest rates.
The Philippine economy expanded by an annual 5.9 percent in the second quarter, down from 6.4 percent in the first, and the central bank said the domestic economy remained strong, but "additional policy support could help ward off the risks associated with weaker external demand by encouraging investment and consumption."
Central Bank News Link List - Oct. 25, 2012: Spanish, Italian banks guy govt bonds in Sept - ECB
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.
- Spanish, Italian banks buy govt bonds in Sept - ECB (Reuters)
- U.S. Treasury rejects request to stop using Libor in bailouts (Bloomberg)
- European Central Bank says private companies borrow less (Fox/AP)
- GDP surge makes BOE stimulus less likely, economists say (Bloomberg)
- Chile central bank head says exchange rate a worry (Reuters)
- India rate-cut odds climb as policy revamp aids rupee (Bloomberg)
- RBNZ (New Zealand) could cut interest rates 'if needed' (stuff.co.nz)
- BOJ minds its words as emerging nations eye global easing warily (Bloomberg)
- PIMCO's El-Erian sees more stimulus from ECB and Fed (Reuters)
- CBK (Kenya) governor summoned over bank (standardmedia)
- www.CentralBankNews.info
Subscribe to:
Posts (Atom)