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Euro To US Dollar Forecast 2024: Increased Threat Of Parity Say Credit Agricole
The Euro to Dollar (EUR/USD) exchange rate has already retreated to 5-month lows just above the 1.0600 level as the theme of divergence between US and Euro interest rates has gained traction. Credit Agricole expects two main factors to drive further losses ahead with a heightened risk that the pair will revisit parity, a level last seen in November 2022. The bank expects monetary policy will be an important source of Euro weakness. It expects that the ECB will cut rates in June, ahead of the Federal Reserve with the first cut now not seen until September, and it also expects that interest rate cuts by the ECB will be ... (full story)
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post: BOE GOV. BAILEY: THE UK ECONOMY ON TRACK WITH FEBRUARY FORECASTS. post: BANK OF ENGLAND'S BAILEY: WE'RE PRETTY MUCH ON TRACK FOR WHERE WE THOUGHT WE WOULD BE IN FEBRUARY ON INFLATION post: BoE’s Bailey: I Expect Next Month’s Inflation Number Will Show Quite a Strong Drop post: BOE GOV. BAILEY: RISKS REMAIN FROM THE MIDDLE EAST CONFLICT. post: BOE GOV. BAILEY: OIL PRICES HAVEN'T LEAPED AS MUCH AS EXPECTED.
Since the early 1990s, many central banks worldwide have adopted a framework for monetary policy known as “inflation targeting”.[ 1 ] In this framework, central banks announce a target rate or range for medium-term inflation, typically 2%, and adjust short-term interest rates to steer actual inflation towards the target.[ 2 ] The rise of inflation targeting was a response to the turbulent inflation episodes of the 1970s and 1980s when most central banks were only loosely committed to price stability. Inflation targeting was an acknowledgement that monetary policy was most effective when it was given a clear mandate. Inflation targeting went hand-in-hand with a discernible increase in central bank independence and transparency. Central banks operating outside the influence of political election cycles played a critical role in making inflation targeting credible and feasible. Political independence, in turn, required central bank officials to publicly explain and justify their actions as a manifestation of democratic accountability. Greater transparency was also needed to operationalise inflation targeting. The reason is that, given the lags in monetary policy transmission, central banks can only affect future inflation. As such, inflation targeting has typically been formulated in terms of inflation forecast targeting where the central bank adjusts policy to offset d post: ECB's Schnabel: Forecast Errors Contributed To Central Banks’ Delayed Reaction To The Surge In Inflation post: MORE ECB'S SCHNABEL: CENTRAL BANKERS SHOULD EVALUATE HOW PROJECTIONS COULD BE MADE MORE ROBUST #europeancentralbank #isabelschnabel #ecb #monetarypolicy #interestrates #inflation
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Overall economic activity expanded slightly, on balance, since late February. Ten out of twelve Districts experienced either slight or modest economic growth—up from eight in the previous report, while the other two reported no changes in activity. Consumer spending barely increased overall, but reports were quite mixed across Districts and spending categories. Several reports mentioned weakness in discretionary spending, as consumers’ price sensitivity remained elevated. Auto spending was buoyed notably in some Districts by improved inventories and dealer incentives, but sales remained sluggish in other Districts. Tourism activity increased modestly, on average, but reports varied widely. Manufacturing activity declined slightly, as only three Districts reported growth in that sector. Contacts reported slight increases in nonfinancial services activity, on average, and bank lending was roughly flat overall. Residential construction increased a little, on average, and home sales strengthened in most Districts. In contrast, nonresidential construction was flat, and commercial real estate leasing fell slightly. The economic outlook among contacts was cautiously optimistic, on balance. post: Fed Beige Book: Overall Economic Activity Expanded Slightly, on Balance, Since Late February. Fed Beige Book: the Economic Outlook Among Contacts Was Cautiously Optimistic, on Balance. Fed’s Beige Book: Employment Rose at a Slight Pace Overall post: FED'S BEIGE BOOK: TEN OF 12 FED DISTRICTS REPORTED SLIGHT OR MODEST GROWTH.
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- Posted: Apr 17, 2024 12:14pm
- Submitted by:Category: Fundamental AnalysisComments: 0 / Views: 3,006