Tag Archive: Bank of Canada

Oil Prices, CPI: Why Not Zero?

In the early throes of economic devastation in 1931, Sweden found itself particularly vulnerable to any number of destabilizing factors. The global economy had been hit by depression, and the Great Contraction was bearing down on the Swedish monetary system. The krona had always been linked to the British pound, so that when the Bank of England removed gold convertibility (left the gold standard) from its notes on September 19 that year the Swedish...

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Constructive US Jobs, but Where Do the Euro Bulls make a Stand?

The US created 209k jobs in July and jobs growth in June was revised higher (+9k) to 231k. The underemployment rate was unchanged at 8.6%. The unemployment rate ticked down to 4.3%, matching the cyclical low set in May. This is all the more impressive because the participation rate also ticked up (62.9% from 62.8%).

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April Jobs Won’t Change Minds

There is something for everyone in today's US jobs report, and at the end of the day, it is unlikely to sway opinion about the direction and timing of the next Fed move. The greenback itself may remain range bound after the initial flurry. On the other hand, the disappointing but noisy Canadian data underscores the risk of a more dovish slant to the central bank's neutral stance next week.

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Sweden’s Gold Reserves: 10,000 gold bars (pet rocks) shrouded in Official Secrecy

In February 2017 while preparing for a presentation in Gothenburg about central bank gold, I emailed Sweden’s central bank, the Riksbank, enquiring whether the Riksbank physically audits Sweden’s gold and whether it would provide me with a gold bar weight list of Sweden’s gold reserves (gold bar holdings). The Swedish official gold reserves are significant and amount to 125.7 tonnes, making the Swedish nation the world’s 28th largest official gold...

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Solid US Jobs Report in line with Expectations

The US jobs report was largely in line with expectations. February was the second consecutive month that the US economy created more than 200k jobs. It is the first time since last June and July. The 235k is just below the revised January 238k gain (initially 227k).

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A Few Thoughts on Canada

Bank of Canada meets Wed. Look for a dovish hold. Foreigners continue to buy Canadian bonds and stocks. The EU-Canadian free-trade deal is facing challenges, with the most pressing one coming from Belgium.

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FX Weekly Preview: Four Key Events in the Week Ahead

Of the forces driving prices in the week ahead, events appear more important than economic reports.There are four such events that investors must navigate.The Bank of Canada and the European Central Bank meet. The UK High Court will deliver its ruling on the role of Parliament in Brexit.The rating agency DBRS updates its credit rating for Portugal.

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Bank of England QE and the Imaginary “Brexit Shock”

Mark Carney, Wrecking Ball. For reasons we cannot even begin to fathom, Mark Carney is considered a “superstar” among central bankers. Presumably this was one of the reasons why the British government helped him to execute a well-timed exit from the Bank of Canada by hiring him to head the Bank of England (well-timed because he disappeared from Canada with its bubble economy seemingly still intact, leaving his successor to take the blame).

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FX Daily, July 29: Kuroda Hesitates, Yen Advances, Focus Turns to Europe and North America

Main events: Far Lower GDP Growth due to higher inflation and bigger trade deficit. Yen and Swissie advance and weaker dollar. Swiss economy remains on track based on the KOF economic barometer.

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FX Daily, July 22: Flash PMIs Show Brexit Impact Localized

As the week draws to a close, there are three main developments in the capital markets. First, the profit-taking seen in US equities yesterday has continued in Asia and Europe today. The MSCI Asia Pacific Index and the Dow Jones Stoxx 600 in Europe are both off around 0.5%.

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FX Weekly Review, July 11 – July 15: It is not About the Dollar, but About Other Currencies

Our weekly review of currency movements, with focus on the Swiss franc. This week: The US dollar is easily the most traded currency, and despite the plethora of other currencies, it is on one side of nearly 90% of all trades. Yet the movement in the foreign exchange market presently is not so much driven by the dollar as it is by other currencies.

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FX Daily, July 13: Sterling and Yen Momentum Slows

The two main developments in the foreign exchange market this week in recent days has been the opposite of what has transpired over the past several weeks. Sterling moved higher quickly. The yen moved down just as fast. Over the past five sessions through late-morning levels, sterling has gained 2.5% while the yen has shed 2.8%.

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FX Daily, July 11: Dollar Extends Gains

The combination of the rebounding US job growth and gains in the S&P 500 to near record levels before the weekend is helping boost the US dollar against the major currencies, while the emerging market currencies are mixed. In addition, indications that Japan will put together another fiscal stimulus package and the Bank of England may cut rates late this week are helping global equities.

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FX Weekly Preview: Sources of Movement

Electoral politics remains significant. BOE is likely to cut rates, while BoC may tilt more dovishly. US Q2 earnings season formally begins.

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FX Weekly Review, July 04 – July 08: Further SNB Interventions, Good Dollar Week

In the Brexit month, the Swiss franc index clearly underperformed the dollar index. The major reason is that the dollar is seen as a better safe-haven than the Swiss Franc, possibly because Swiss sales are affected more when British demand falls.

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FX Daily, July 08: US Jobs Data, Little Policy Significance, Swiss Unemployment falls

Positive job data in the United States are typically positive for both USD and EUR, because the odds of a rate hike are increasing. Consequently the EUR/CHF rose. In the last two days SNB interventions should have been smaller. The Swiss unemployment rate fell from 3.5% to 3.3%.

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North American Jobs Report and Implications

There is something for everyone in today's US jobs report, and at the end of the day, it is unlikely to sway opinion about the direction and timing of the next Fed move. The greenback itself may remain range bound after the initial flurry. On the other hand, the disappointing but noisy Canadian data underscores the risk of a more dovish slant to the central bank's neutral stance next week.

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FX Daily, July 05: Sterling Hammered to New Lows, Yen Pops, SNB intervenes

The British pound has been hammered to fresh lows just above $1.3115. The euro is moving toward GBP0.8500. The immediate catalyst is three-fold. First, one of the UK's largest property funds has moved to prevent retail liquidation. Second, the BOE reversed an earlier decision on the capital buffer for banks, which is tantamount to easing policy by boosting the banks' lending capability by as much as GBP150 bln.

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Central Banks & Governments and their gold coin holdings

While this is true in some cases, it is not the fully story because many central banks and governments, such as the US, France, Italy, Switzerland, the UK and Venezuela, all hold an element of gold bullion coins as part of their official monetary gold reserves.

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FX Daily, May 25: Dollar Marks time

  The US dollar is little changed against the major currencies as yesterday’s moves are consolidated and traders wait for fresh developments.  Global equities were higher after Wall Street’s advance yesterday.  Asia-Pacific bond yields were firm, following the US lead, but European 10-year benchmark yields are lower, led by the continued rally in Greek bonds …

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