Category: central banks

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The 119th Congress takes its seat tomorrow as the dollar continues to strengthen.

The GOP-controlled 119th Congress will take its seat around noon tomorrow. Over in the House chamber, there will be a vote for the Speaker of the House. Meanwhile, results from the Pan-European Manufacturing Purchasing Managers Index demonstrates the danger of making a five day call on where the EUR/USD may end up at week’s end. … Continue reading The 119th Congress takes its seat tomorrow as the dollar continues to strengthen.

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Looking behind the gardened walls of central banks

Where are the trading desks of the Federal Reserve System and the European Central Bank moving markets? Back in mid-December, the Federal Open Market Committee directed its trading desk at the Federal Reserve Bank of New York to undertake open market operations to maintain the federal funds rate between the target range of 4.25% and … Continue reading Looking behind the gardened walls of central banks

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If FDI inflows are trending down, shouldn’t price of USD follow?

With all the talk of Brazil, Russia, India, China, and South Africa going their own way by moving away from the USD, the presumptive president-elect seeking a weaker dollar that promotes the export of goods manufactured in the United States, and a downward trend in foreign direct investment inflows to the United States, it would … Continue reading If FDI inflows are trending down, shouldn’t price of USD follow?

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Narrative. Perception. Sentiment. And the dollar continues to strengthen against the yen.

Narrative. Perception. Sentiment. That is what I saw tonight in play after the Bank of Japan released its statement on monetary policy. The USD/JPY was trading today around 153.786 at 1:00 pm EST. At 2:00 pm EST, when the Federal Open Market Committee released its statement, the yen had fallen, reflected in a USD/JPY of … Continue reading Narrative. Perception. Sentiment. And the dollar continues to strengthen against the yen.

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The Interbank Market: The Ghanaian cedi continues its appreciation against the dollar.

Liquidity Foreign exchange, algorithmic trading, volatility. Financial markets have become more susceptible to liquidity shortages with the rise of algorithmic trading and increased market fragmentation, according to the Bank for International Settlements. Foreign-exchange trading, meanwhile, proved more resilient potentially due to measures taken to curb unwanted behavior from high-frequency traders. Yahoo!Finance. Excess liquidity. Thailand’s banking … Continue reading The Interbank Market: The Ghanaian cedi continues its appreciation against the dollar.

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The Interbank Markets: From Trump effect to the Trump hedge.

Nigeria, naira, foreign exchange. The Central Bank of Nigeria has issued fresh guidelines for interbank foreign exchange trading via the Electronic Foreign Exchange Matching System, mandating a minimum trade value of $100,000. The directive, dated 25 November 2024 and signed by Dr Omolara Duke, CBN’s Director of the Financial Markets Department, is part of efforts … Continue reading The Interbank Markets: From Trump effect to the Trump hedge.

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Interbank and Liquidity News Scan: Kashkari is open to a December rate cut.

Kashkari. Interest rates. Federal Reserve Bank of Minneapolis President Neel Kashkari, typically on the hawkish end of the U.S. central bank’s policy spectrum, said on Monday he is open to cutting interest rates again next month. Reuters. Trump. Tariffs. Markets. The dollar rallied on Tuesday, while European shares fell, after U.S. President-elect Donald Trump pledged tariffs on … Continue reading Interbank and Liquidity News Scan: Kashkari is open to a December rate cut.

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Growth in money supply is relatively flat, but is money more expensive?

Between September 2023 and September 2024, M2 money supply went from approximately $18,110.3 billion to $18,151.4 billion, according to data from the Board of Governors of the Federal Reserve System. This amounted to a decrease in money supply of 2.17%. During that period, the money supply dipped as low as $17,923.3 billion in February 2024. … Continue reading Growth in money supply is relatively flat, but is money more expensive?