The Federal Reserve and the ECB, together with 4 other central banks, decided to lower rates on dollar swaps by 50 basis points. As mentioned in recent days, the euro/dollar swap has reached levels last seen in 2008. This coordinated action had a strong impact on currencies, and sent EUR/USD back to the range seen … “Why the Swap Cut Rally Will Likely Be Short Lived”
Month: November 2011
Loonie Surges as Central Bank Move Sinks Greenback
Earlier, several central banks announced coordinated action to keep US dollars cheaper. The move has prompted a gain in risk appetite that is helping the Canadian dollar today on the Forex market. Central banks in the US and Europe, as well as the Bank of Japan, decided to extend the policy of dollar swaps that contribute to some of the liquidity of the world’s money supply. As a result of the move, the US dollar is plunging. Demand for high beta currencies, including … “Loonie Surges as Central Bank Move Sinks Greenback”
US Dollar Plummets on Central Bank Coordination
US dollar is down across the board on the latest move by the world’s major central banks to increase liquidity. In an effort to inject confidence in global markets, several central banks are coordinating efforts to make the US dollar cheaper. Worried about another credit squeeze, several central banks, including the Federal Reserve, European Central Bank, Bank of England, Bank of Japan, Swiss National Bank and the Bank of Canada, are coordinating efforts … “US Dollar Plummets on Central Bank Coordination”
Brazilian Real Gains Despite Dovish Outlook
The Brazilian real gained today despite the speculation that the central bank will be forced to cut the interest rates further as the global economic growth stalls. China decreased the required amount of cash that banks should keep as reserves. Economists think that the most likely reason for such decision is the concern that the slowing world economy will hurt the nation’s exports. That’s just one of the signs that China expects … “Brazilian Real Gains Despite Dovish Outlook”
Forint Goes Down, More Interest Rate Hikes Expected
The Hungarian forint fell today even though the nation’s central bank increased interest rates, prompting the speculation that more rate hikes will be performed in the future. The Magyar Nemzeti Bank (the central bank of Hungary) boosted its two-week deposit rate from 6 percent to 6.5 percent yesterday. Bank’s President Andras Simor said that he’s ready to increase the lending rates further, even though they are … “Forint Goes Down, More Interest Rate Hikes Expected”
The US economy is in no state to support the
While recent indicators have been positive, the recent crisis in Europe is too strong for the world’s No. 1 economy. In the euro-zone, a rate cut seems likely, at least for easing the pressure for quantitative easing. John Kicklighter of DailyFX discusses the crisis, the US economy, the status of safe haven currencies and more … “The US economy is in no state to support the”
Mexican Central Bank Plans to Support Peso
The Mexican peso advanced today as the nation’s central bank pledged to support the currency in case it would decline too much. Mexico’s currency exchange commission, which is made up from representatives of the central bank and Finance Ministry, said its going to use $400 million from its $140 billion reserves in case the peso would decline more than 2 percent in one day. The Mexican currency already has … “Mexican Central Bank Plans to Support Peso”
Canada’s Dollar Rallies to Two-Month Record vs. Euro
The positive sentiment is still present on markets, allowing the Canadian dollar to rise, reaching the highest level since September against the euro. The improving outlook for Europe was followed by the favorable news from the United States (the biggest trading partner of Canada). The US consumer confidence index improved from 40.9 in October to 56.0, ending its decline. The good sales during Thanksgiving holiday period were also positive. The positive mood was … “Canada’s Dollar Rallies to Two-Month Record vs. Euro”
US Dollar Index Drops on Optimism
The US dollar index is dropping as optimism returns to the Forex market. High beta currencies are gaining as the Italian bond auction restores some equanimity to Forex traders. Earlier, an Italian bond auction was deemed successful, even though yields were high. A great deal of the debt in question was bought, and it turned out to be a bigger success than last week’s German bund auction. As a result, Forex traders … “US Dollar Index Drops on Optimism”
Another Day of Gains for Rand?
The South African rand gained today as the positive mood prevailed on the Forex market, but later reversed its trend and currently almost erased its earlier gains. The explanation for such reversal may be the fundamentals that don’t support the positive outlook. South Africa’s economy grew 1.4 percent in the third quarter, less than economists predicted. Citigroup Inc. cut China’s growth estimate for the next year from 8.7 percent … “Another Day of Gains for Rand?”