Albania's central bank cut its key interest rate by 25 basis points to 2.50 percent, saying a further easing of monetary conditions should help inflation return to the bank's 3.0 percent target.
The Bank of Albania, which previously cut its rate by 25 basis points in February, said the rate reduction reflected the bank's view of low inflationary pressures in the quarters ahead in response to weak aggregate demand and the downward inflation trend in its trading partners.
"This move contributes to boosting domestic consumption and investments, aiming at a fuller utilization of production capacities and a faster return of inflation to our target," the bank's governor, Ardian Fullani said in a statement.
The central bank has now cut rates by 275 basis points since October 2011.
Albania's inflation rate eased to 1.7 percent in April from 2.2 percent in March, below the bank's inflation target of 3.0 percent, plus/minus one percentage point.
Production below the country's capacity has led to low increase in employment, wages and production costs and inflation expectations remain subdued, but close to the bank's target.
Friday, May 30, 2014
Fiji maintains accommodative stance, objectives intact
Fiji's central bank maintained its policy rate at 0.50 percent and said the bank's twin objectives remain intact so "the current accommodative stance remains appropriate to support the domestic economic expansion."
The Reserve Bank of Fiji, which has held its benchmark Overnight Policy Rate (OPR) steady since November 2011, also said price pressures are expected to remain stable with the year-end inflation forecast unchanged at 3.0 percent.
Fiji's central bank has the twin objectives of stable inflation and foreign reserves. Last month the central bank said it would "re-align" monetary policy if there were challenges to its objectives.
Fiji's inflation rate rose to 0.1 percent in April after a negative rate of 0.2 percent in March, helped by price rises on alcoholic drinks and tobacco, and certain non-foods.
Barry Whiteside, governor and chairman of the reserve bank board, said in a statement that "domestic economic conditions continue the robustness shown last year" with private sector credit expanding by 11.6 percent year-on-year in April and the government's expenditure "notably" higher this year.
The Reserve Bank of Fiji, which has held its benchmark Overnight Policy Rate (OPR) steady since November 2011, also said price pressures are expected to remain stable with the year-end inflation forecast unchanged at 3.0 percent.
Fiji's central bank has the twin objectives of stable inflation and foreign reserves. Last month the central bank said it would "re-align" monetary policy if there were challenges to its objectives.
Fiji's inflation rate rose to 0.1 percent in April after a negative rate of 0.2 percent in March, helped by price rises on alcoholic drinks and tobacco, and certain non-foods.
Barry Whiteside, governor and chairman of the reserve bank board, said in a statement that "domestic economic conditions continue the robustness shown last year" with private sector credit expanding by 11.6 percent year-on-year in April and the government's expenditure "notably" higher this year.
Colombia raises rate another 25 bps to curb inflation
Colombia's central bank raised its benchmark intervention rate for the second time in as many months to ensure that inflation converges towards it target and again said a "gradual adjustment of the expansionary stance of monetary policy reduces the need for sudden changes in the future and ensure macroeconomic stability."
The Central Bank of Colombia has now raised its benchmark rate by a total of 50 basis points to 3.75 percent by raising it by 25 basis points in April and today.
The first rate rise in April of 25 basis points surprised financial markets and the central bank also said at that time that it was raising rates to avoid a sharper tightening in the future. The central bank cut rates by 100 basis points during the first quarter of 2013.
Inflation in Colombia continued to accelerate toward the central bank's 3.0 percent midpoint target in April, hitting 2.72 percent, up from 2.51 percent in March and the fifth month of rising prices.
The bank said inflationary expectations one year ahead had risen from last month and the economic forecast indicates that domestic demand will continue to grow steadily and the economic will approach full use of capacity this year while unemployment continues to trend lower.
"Given all this and the lags with which monetary policy actions affect inflation and growth, the Board considered it prudent to increase the intervention interest rate by 25 basis points," the central bank said, adding that monetary policy would depend on available information.
The Central Bank of Colombia has now raised its benchmark rate by a total of 50 basis points to 3.75 percent by raising it by 25 basis points in April and today.
The first rate rise in April of 25 basis points surprised financial markets and the central bank also said at that time that it was raising rates to avoid a sharper tightening in the future. The central bank cut rates by 100 basis points during the first quarter of 2013.
Inflation in Colombia continued to accelerate toward the central bank's 3.0 percent midpoint target in April, hitting 2.72 percent, up from 2.51 percent in March and the fifth month of rising prices.
The bank said inflationary expectations one year ahead had risen from last month and the economic forecast indicates that domestic demand will continue to grow steadily and the economic will approach full use of capacity this year while unemployment continues to trend lower.
"Given all this and the lags with which monetary policy actions affect inflation and growth, the Board considered it prudent to increase the intervention interest rate by 25 basis points," the central bank said, adding that monetary policy would depend on available information.
Thursday, May 29, 2014
Trinidad holds rate, says inflationary pressures could rise
Trinidad and Tobago’s central bank maintained its accommodative policy stance by leaving the repo rate at its historic low of 2.75 percent but cautioned that inflationary pressures could rise in the coming year.
The Central Bank of Trinidad and Tobago, which has kept its rate steady since September 2012, said a strengthening economic recovery, rising consumption and the threat of higher international agricultural commodity prices suggest inflationary pressures could rise.
“With a firmly established economic recovery, the Central Bank will start giving more weight in its monetary policy deliberations to managing rising inflationary pressures,” Governor Jwala Rambarran said in an address to Tobago’s house of assembly, only the second time in the bank’s 50-year history that it has ventured outside the Port of Spain.
At first, the central bank would start gradually withdrawing the accommodative stance but “should the outlook for inflation, growth, or financial stability change, we will take appropriate action,” he added.
So far inflationary pressures have been subdued, with headline inflation of 3.5 percent in April, down from 4.5 percent in March, due to a steady fall in food price inflation from improved agricultural output and an easing of global food prices.
The Central Bank of Trinidad and Tobago, which has kept its rate steady since September 2012, said a strengthening economic recovery, rising consumption and the threat of higher international agricultural commodity prices suggest inflationary pressures could rise.
“With a firmly established economic recovery, the Central Bank will start giving more weight in its monetary policy deliberations to managing rising inflationary pressures,” Governor Jwala Rambarran said in an address to Tobago’s house of assembly, only the second time in the bank’s 50-year history that it has ventured outside the Port of Spain.
At first, the central bank would start gradually withdrawing the accommodative stance but “should the outlook for inflation, growth, or financial stability change, we will take appropriate action,” he added.
So far inflationary pressures have been subdued, with headline inflation of 3.5 percent in April, down from 4.5 percent in March, due to a steady fall in food price inflation from improved agricultural output and an easing of global food prices.
Egypt holds rate, repeats limited upside inflation risks
Egypt's central bank maintained it policy rates and repeated that downside risks to economic growth will limit upside risks to inflation going forward and the bank "will not hesitate to adjust the key CBE rates to ensure price stability over the medium-term."
The Central Bank of Egypt (CBE) has maintained its benchmark overnight deposit rate at 8.25 percent this year after cutting it by 100 basis points last year. In April the CBE also said downside risks to the economy would limit future inflation.
Economists were split in their view of whether the CBE would cut rates today after former-army chief Abdel Fattah al-Sisi took more than 90 percent of the vote in the presidential election, according to a preliminary count. Al-Sisi toppled President Mohamed Morsi in a popular coup last July.
Egypt's headline inflation rate eased to 8.87 percent inflation in April, down from 9.82 percent in March, and the lowest in six months. Core inflation eased to 9.11 percent from March's 9.90 percent.
Although CBE said the decline was helped by favorable base effects, it added that inflation this year has been driven by higher food prices and April was the first month with muted prices.
"Upside risks to the inflation outlook continue to be contained as the possibility of a sharp rebounding international food prices is unlikely in light of recent global developments," CBE said.
The Central Bank of Egypt (CBE) has maintained its benchmark overnight deposit rate at 8.25 percent this year after cutting it by 100 basis points last year. In April the CBE also said downside risks to the economy would limit future inflation.
Economists were split in their view of whether the CBE would cut rates today after former-army chief Abdel Fattah al-Sisi took more than 90 percent of the vote in the presidential election, according to a preliminary count. Al-Sisi toppled President Mohamed Morsi in a popular coup last July.
Egypt's headline inflation rate eased to 8.87 percent inflation in April, down from 9.82 percent in March, and the lowest in six months. Core inflation eased to 9.11 percent from March's 9.90 percent.
Although CBE said the decline was helped by favorable base effects, it added that inflation this year has been driven by higher food prices and April was the first month with muted prices.
"Upside risks to the inflation outlook continue to be contained as the possibility of a sharp rebounding international food prices is unlikely in light of recent global developments," CBE said.
Central Bank News Link List - May 29, 2014 - BOJ’s Shirai sees record easing continuing past 2015
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’s Shirai sees record easing continuing past 2015 (Bloomberg)
- BOJ revises government bond operations to manage record easing (Bloomberg)
- BoE should nudge interest rates up by the end of this year (Rob Wood/Telegraph)
- Korean bonds gain on bets European Central Bank to add stimulus (Bloomberg)
- NZ dollar may fall on ECB moves (TVNZ)
Wednesday, May 28, 2014
Brazil maintains Selic rate at 11.0 pct after 9 raises
Brazil's central bank maintained its benchmark Selic rate at 11.0 percent, as widely expected, ending its monetary tightening cycle after nine rate rises that started in April 2013.
The Central Bank of Brazil said in a brief statement that its policy committee, known as Copom, had unanimously agreed on keeping the rate steady at this time in light of the macroeconomic scenario and the outlook for inflation. Copom did not indicate a bias.
The central bank has raised its rate by a total of 375 basis points since last April, including 100 points this year.
In April the central bank signaled that it was getting closer to freezing the rate as it changed its guidance to say that it would monitor the economic scenario and this would define its next step. In February and January the bank had said the rate rises were a continuation of an adjustment of the interest rate process that had begun in April last year.
In addition, central bank officials, including President Alexandre Tombini, had on several occasions recently said the past interest rate rises were having a delayed effect on inflation and inflation would start to slow in coming months.Tuesday, May 27, 2014
Central Bank News Link List - May 28, 2014 - ECB's Mersch: Next meeting could yield combination of policies
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.
- ECB's Mersch: Next meeting could yield combination of policies (Reuters)
- Bank of England's Weale: raise rates sooner rather than later-FT (Reuters
- Fischer sworn in as member of U.S. Federal Reserve's board (Reuters)
- Fed’s Lockhart sees growth rebound, no rush to raise rates (Reuters)
- Turkish ministers sing differing tunes over interest rate policy (Hurriyet)
- Brazil: Copom to halt hikes despite poor inflation scenario (MNI)
- Get ready: UK interest rates to go up in February says UBS (Yorkshire Post)
- BOJ Kuroda: Monetary easing possible under zero interest rates (MNI)
- Constancio says any ECB policy package would have clear aim (Bloomberg)
- BOJ posts net profit of Y724.2 bin in FY13 vs Y576 bin in FY12 (MNI)
- Polish economy solid, rate rise discussion months away-central banker (Reuters)
- RBI's Rajan worried end of easy money policies could hurt emerging markets (WSJ)
- Yellen concerned by housing slowdown she has scant power to cure (Bloomberg)
- Iceland: defunct banks could bankrupt unless creditors take haircut (Reuters)
- Former Fed official calls for decisions on rate hike mechanics (WSJ)
- India cenbank to keep rates on hold, GDP to confirm sluggish economy (Reuters)
- RBI growing $315 bln reserves floods India with cash (Bloomberg)
- Schaeuble says ‘large risks’ in Europe’s monetary policy (Reuters)
- Carney says capitalism must reassess bankers’ ‘sense of self’ (Bloomberg)
- Sri Lanka cenbank doesn’t want rupee to appreciate quickly-dep. gov (LBO)
- Sri Lanka SEC watchful of stock bubble amid low interest rates (Reuters)
- Sri Lanka central bank further relaxes foreign exchange regulations (ColomboPage)
- Kenya central bank shows ready to defend struggling shilling (Reuters)
- Niall Ferguson's (mostly) comforting history of central bank B/S expansions (WSJ)
- Argentina's central bank to cut rates if inflation eases (WSJ)
Hungary cuts rate 22nd time, to mull next step in June
Hungary's central bank trimmed its base rate for the 22nd time in a row and "will decide on the need and possibility of reducing the base rate further after a comprehensive assessment of the macroeconomic outlook and developments in perception of the risks about the economy" in June.
The National Bank of Hungary, which cut its base rate by a further 10 basis points to 2.40 percent, said it still believes that there is a degree on unused capacity in the economy and inflationary pressures are likely to remain moderate for an extended period.
In June the central bank will update its quarterly inflation report.
"The negative output gap is expected to close gradually at the policy horizon; however, achieving price stability in the medium term points in the direction of monetary easing," the bank said, adding that an improvement in the perceptions of the risk associated with Hungary's economy had provided scope for the latest "cautious reduction in interest rates."
The rate cut was largely expected by economists after a plunge in April inflation to a negative 0.1 percent following the government's third round of mandated price cuts for household energy.
The central bank has now cut rates by a total of 460 basis points since embarking on an easing cycle in August 2012, including cuts totaling 60 points this year.
The National Bank of Hungary, which cut its base rate by a further 10 basis points to 2.40 percent, said it still believes that there is a degree on unused capacity in the economy and inflationary pressures are likely to remain moderate for an extended period.
In June the central bank will update its quarterly inflation report.
"The negative output gap is expected to close gradually at the policy horizon; however, achieving price stability in the medium term points in the direction of monetary easing," the bank said, adding that an improvement in the perceptions of the risk associated with Hungary's economy had provided scope for the latest "cautious reduction in interest rates."
The rate cut was largely expected by economists after a plunge in April inflation to a negative 0.1 percent following the government's third round of mandated price cuts for household energy.
The central bank has now cut rates by a total of 460 basis points since embarking on an easing cycle in August 2012, including cuts totaling 60 points this year.
Central Bank News Link List - May 27, 2014 - ECB rate cut next week under discussion: Nowotny
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.
- ECB rate cut next week under discussion: Nowotny (Reuters)
- Raghuram Rajan calls on FM Jaitley, discusses inflation, economy (PTI)
- Mexico’s Carstens supports advanced econ unconventional monpol (MNI)
- Euro zone inflation seen well below 2 percent in 2014-15: Nowotny (Reuters)
- Bond market to Fed: Your 4% rate forecast is way too high (Bloomberg)
- Mexico central bank: No fears of ‘currency war’ (CNBC)
- Korea central bank policy members wary of Sewol aftermath-minutes (Yonhap)
- Time for China to ease monetary policy (China Daily/Standard Chartered)
- Krugman warns ECB about getting stuck in Japan-like scenario (Reuters)
- Egypt’s central bank may cut rates on Thursday (Reuters)
- IMF’s Lagarde says bank reforms slowed by fierce industry pushback (Reuters)
- IMF: Spain on right track, but may need monetary easing (WSJ)
- Widows sees company bond rally running out of steam (Bloomberg)
- Vietnam central bank says to intervene in gold market (Vietnam Net Bridge)
- Swaziland’s foreign exchange reserves dip to $794m–central bank (StarAfrica)
Monday, May 26, 2014
Angola holds key rate, raises absorption rate 25 bps
Angola's central bank maintained its key policy rate but raised the rate on its liquidity absorption facility by a further 25 basis points to 1.75 percent.
The National Bank of Angola (BNA) has kept it benchmark BNA rate steady at 9.25 percent since November 2013 but on April 1 raised the rate on its absorption facility by 25 basis points to 1.50 percent and cut the rate on its standing lending liquidity facility by 25 basis points to 10.0 percent.
Angola's inflation rate eased further to 7.22 percent in April from 7.32 percent in March, the 11th consecutive month with falling consumer prices.
In its statement, the BNA also said credit to the economy had risen by 2.25 percent in April while the LUIBOR overnight rate was 3.10 percent.
Commercial banks acquired currency worth US$ 2.076 billion in the foreign exchange market in April, with the total sales volume in the first four months of the year rising to $9.888 billion from $5.445 billion in the same 2013 period.
The average exchange rate of the kwanza currency in April was steady at 97.88 per dollar.
Last month the BNA's governor, Jose de Lima Massano, told Bloomberg in an interview that there was room to cut interest rates to spur investment as inflation eases and the bank has reached its 2014 inflation target of 7.0 to 9.0 percent.
The National Bank of Angola (BNA) has kept it benchmark BNA rate steady at 9.25 percent since November 2013 but on April 1 raised the rate on its absorption facility by 25 basis points to 1.50 percent and cut the rate on its standing lending liquidity facility by 25 basis points to 10.0 percent.
Angola's inflation rate eased further to 7.22 percent in April from 7.32 percent in March, the 11th consecutive month with falling consumer prices.
In its statement, the BNA also said credit to the economy had risen by 2.25 percent in April while the LUIBOR overnight rate was 3.10 percent.
Commercial banks acquired currency worth US$ 2.076 billion in the foreign exchange market in April, with the total sales volume in the first four months of the year rising to $9.888 billion from $5.445 billion in the same 2013 period.
The average exchange rate of the kwanza currency in April was steady at 97.88 per dollar.
Last month the BNA's governor, Jose de Lima Massano, told Bloomberg in an interview that there was room to cut interest rates to spur investment as inflation eases and the bank has reached its 2014 inflation target of 7.0 to 9.0 percent.
Central Bank News Link List - May 26, 2014 - Draghi says timing key as ECB watches for negative spiral
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.
- Draghi says timing key as ECB watches for negative spiral (Bloomberg)
- ‘Are you kidding?’ PM Erdogan slams Turkish cenbank over rate cut (Hurriyet)
- Bank of England’s Bean says may be case for earlier rate hikes-BBC (Reuters)
- BOJ’s Iwata signals chance of tapering if economy overheats (Reuters)
- Lagarde says central banks may have to consider financial stability (WSJ)
- BOJ’s Sato proposed highlighting risks on price target: minutes (Reuters)
- Coeure: ECB’s options include negative interest rates – paper (Reuters)
- Brazil’s central bank seen ending year-long rate hike cycle Wednesday (WSJ)
- Russian economy to grow by 0.5 percent in 2014 - Nabiullina (Reuters)
- Thailand’s junta summons central bank chief to army compound (Bloomberg)
- Turkey remains vulnerable to external shocks – Fitch (Balkans)
- Hungarian yields approach record low, rate cut seen (Reuters)
- BOJ chief prods Abe to get moving on reforms (AFP/JIJI)
- No need to overhaul monetary policies: MAS (Singapore Business Review)
- Higher interest rates felt by New Zealanders, survey shows (WBP Online)
- Kenya central bank shows ready to defend struggling shilling (Reuters)
- Poland may have to keep interest rates at lows beyond September (WSJ)
- Central banks must be on guard against currency wars: ECB’s Coeure (Reuters)
- Swiss monetary policy: Toward negative interest rates? (Pictet)
- RBI to maintain status quo June 3: poll (Business Standard)
- Credit dilemma: monetary and financial stability in Sri Lanka (Daily Mirror)
- Experts advise Emefiele on Nigeria’s monetary policy (Leadership)
- Trinidad central bank moves to ease foreign exchange shortage (Jamaica Observer)
- Trinidad consumer debt up by $6 bn (Guardian)
- Armenia central bank revises downwards growth projection to 4.1%-4.8% (Arka)
- Zimbabwe central bank cuts economic growth outlook to 3.1 pc (New Zimbabwe)
- Bahrainis praise PM for his calls to maintain fairer interest rates (Gulf Daily News)
- Israel declares war on Palestinian banks (Sabbah Report)
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