Monetary Policy

30 September 2016

The euro is trading at its lowest level against the Norwegian krone since August 2015.  The euro is near its best levels against the Swedish krona in nearly as long.  The euro is trading at its lowest level against the Norwegian krone since August 2015.  The euro is near its best...

Featured Articles

13 September 2016

Maxed Out Monetary Policy

The market has not changed its mind.  Following Brainard's comments yesterday the market had downgraded the chances, which were already modest, of a Fed hike next week.  The September Fed funds futures is unchanged on the day.  The implied yield...

13 September 2016

Is there Room to Raise Rates?

Our approach to Fed-watching is clear:  Among the cacophony of voices, the Troika of Fed leadership, Yellen, Fischer and Dudley provide the clearest signal. They are most often on message, and their comments have been the best indications of policy.  ...

8 September 2016

ECB Rate Policy Unchanged, but Growth Forecast is Shaved

The shaving of 2017 and 2018 growth forecasts, recognition of continued downside risks did not prompt the ECB to adjust monetary policy.  Rates were left unchanged, as widely expected.  The ECB also refrained from extending the asset purchases.  This is...

5 September 2016

ECB Grabs Central Bank Watchers’ Attention

The last two weeks have been about the US.  First, it was Jackson Hole. The leadership of the Federal Reserve, Yellen, Dudley and Fischer sang from the same songbook. They all signaled that the time was approaching to take another...

29 August 2016

The Divergent Monetary Policy Theme is Back

The US dollar staged a strong pre-weekend rally on hints that the Fed will raise rates before the end of the year.  There was initially follow through dollar buying in Asia before a more stable tone emerged in Europe, where...

26 August 2016

Playing the Central Bank Odds

Yellen's presentation at Jackson Hole today is the highlight of the week.  It also marks the end of the summer for many North American and European investors.  It may be a bit of a rolling start for US participants, until...

24 August 2016

Arguing Against Kocherlakota’s Argument

Former Minneapolis Fed President Kocherlakota, and now a professor at the University of Rochester used this Great Graphic in a recent Bloomberg column. Kocherlakota was a dove when he was at the Fed and remains dovish.  He is concerned that...

22 August 2016

Team Dudley Includes Fischer

Last week, some market participants were giving more credence to what seemed like dovish FOMC minutes than to NY Fed President Dudley's remarks that accused investors of complacency over the outlook for rates.  Yesterday, Vice-Chairman of the Federal Reserve Fischer...

16 August 2016

RBA Governor Stevens is Stepping Away after 10 Years

  On September 18 2016, Glenn Stevens will end his ten-year mandate as governor of the Reserve Bank of Australia (RBA). His experience in the top job provides a wealth of lessons for the next generation of policymakers; that’s arguably...

9 August 2016

Bernanke’s Brookings Blogging is all about the Data

Former Fed Chair Bernanke keeps a blog at Brookings.  His latest post offers insight into how to think about Federal Reserve, and in particular, Fed officials' understanding of the US economy.  Former Fed Chair Bernanke keeps a blog at Brookings. ...

4 August 2016

Today is the BOE’s Day to Surprise or Disappoint

The Bank of England owns today, though tomorrow will be about the US jobs report. The BOE disappointed the market last month by not immediately responding to the UK referendum.  It had laid out a somber economic and financial scenario...