Jerome Powell, chairman of the Board of Governors of the Federal Reserve System wrapped up his semi-annual visit to Capitol Hill basically saying all is well with the Fed’s implementation of monetary policy. Chairman Powell assured both the House yesterday and the Senate today that the labor market was at or near maximum employment although … Continue reading Not much moved me about Chairman Powell’s testimony this week …
Michelle Bowman, the Board of Governors of the Federal Reserve System’s vice-chair for supervision, will speak at 10:00 AM EDT at the International Journal of Central Banking conference in Prague. As vice-chair of supervision, Vice-Chair Bowman is responsible for the Board’s understanding of banks’ operations, banks’ major risks, how well banks manage these risks and … Continue reading Binary options: Miki Bowman speaks at 10:00 am today in the midst of intensified global risks …
The Federal Open Market Committee decided to maintain its target range for the effective federal funds rate between 4.25% and 4.50%. The FOMC reiterated its intent to stay focused on the incoming data. This data would include information on labor market conditions, inflation pressures and expectations, as well as financial and international developments. What I … Continue reading Nothing surprising about the Fed’s decision. More surprises in FX at 2:00 pm.
The Federal Reserve as narrative promoter … While not a political organization, the Board of Governors of the Federal Reserve System as an agent of the Congress, is responsible for crafting a narrative around the soundness of the United States currency. The centerpiece of the soundness narrative is found in 12 USC 225(a) where Congress … Continue reading Federal Reserve: Is understanding the Fed that difficult or even useful?
May 15, 2025 NEW YORK—The Federal Reserve and U.S. Treasury did not intervene in foreign exchange markets during the January – March 2025 quarter, the Federal Reserve Bank of New York said today in its quarterly report to the U.S. Congress. The U.S. dollar, as measured by the Federal Reserve Board’s broad trade-weighted dollar index, … Continue reading The Federal Reserve and U.S. Treasury Did Not Intervene in FX Markets During the First Quarter
As of 6:12 pm EST, the NADEX offered the following binary options contracts for the EUR/USD expiring this Friday (23 May 2025) at 3 pm: Contract closing above 1.1225. Buy at $4.10 Contract closing above 1.1175. Buy at $5.00 Contract closing above 1.1125. Buy at $7.70 Contract closing above 1.1075. Buy at $9.10 Contract closing … Continue reading So far, a 98% chance the EUR/USD will close above 1.1025 this Friday
My back of the napkin forward rate calculation of EUR/USD=1.1210 on Friday. The NADEX is pricing the probability of EUR/USD exceeding 1.1225 at $4.10. The probability of EUR/USD exceeding 1.1175 is priced at $7.20. At 9:36 am, Reuters priced the EUR/USD at 1.1210, an increase of 35 pips from yesterday’s 4:15 pm read of 1.1175. … Continue reading The Interbank Markets: EUR/USD hovers around 1.1210 as of 9:36 am.
The data as of 11:32 EST … Investing.com has calculated a forward rate contract price for EUR/USD on 16 May 2025 at 1.1205. That compares with my back of the napkin forward rate calculation of EUR/USD=1.1210 on Friday. The NADEX is pricing the probability of EUR/USD exceeding 1.1225 at $4.50. At 11:00 am, Reuters priced … Continue reading The Interbank Markets: Will ECB seek other sources of dollar funding?
What the data is telling me … At 8:33 am today, I saw further slight strengthening in the US dollar against the euro and the yen. Data from Reuters evidenced declines from yesterday in the yields of ten-year bonds out of the United States, United Kingdom, Australia, Germany, and Japan. These declines told me that … Continue reading Is a recession around the corner?
Lawyers Write the Bets. Bankers Sell the Bets. 