Thu, Jan 28, 2021 @ 09:02 GMT
Home Tags BoE

BoE

BoE expands QE by GBP 150B, Q4 GDP to contract on Covid

BoE voted unanimously to keep Bank Rate unchanged at 0.10% as widely expected. The government bond purchases problem is expanded the target stock of purchased UK government bonds by additional GBP 150B, taking to the total to GBP 875B. The central bank will "continue to monitor the situation closely"...

(BOE) Bank Rate Maintained at 0.1%

The Bank of England's Monetary Policy Committee (MPC) sets monetary policy to meet the 2% inflation target, and in a way that helps to sustain growth and employment. In that context, its challenge at present is to respond to the economic and financial impact of the Covid pandemic. At...

Stocks Surge on US Elections, Dollar and Yen Weak But No Follow Through Selling Yet

Movements in the forex markets in reaction to the US elections were relatively indecisive, comparing to the strong risk-on moves in the stocks. There is no clear follow through selling in Dollar and Yen so far, while commodity currencies are struggling to extend gains. Focuses will now turn to...

Bank of England Set to Boost QE as Lockdown and Brexit Cause Economic Havoc

The Bank of England will conclude its latest policy meeting on Thursday, announcing its decision at 12:00 GMT. As it’s November, the Bank will also be publishing its quarterly Monetary Policy Report alongside the meeting minutes. But while a virtual press conference is pencilled in too, it will be...

BOE Preview – Expanding QE Size while Keeping Rate Unchanged at Record Low

At the meeting this week, we expect BOE to increase the size of asset purchases (QE), by 100B pound, to 845B pound. The Bank rate will stay unchanged at 0.1%. Economic data released since the last meeting suggest that the members’ forecasts in August were too optimistic. A downgrade...

Dollar Firm into a Week of Election, Fed and NFP

Dollar and Yen strengthen in general in Asian session today even though risk sentiments are not bad, as seen in rally in major indices. Solid data from China was enough to offset the pessimism over lockdowns in Europe, and the steep decline in oil prices. Sterling is currently the...

Week Ahead – US Election, Three Central Banks, and Nonfarm Payrolls

It is probably the busiest week ever for markets. The US presidential election will eclipse everything else, but there are several other crucial events like a Fed meeting and nonfarm payrolls to follow the main dish. The Bank of England and the Reserve Bank of Australia will decide as...

Dollar Recovers Mildly after Job Data, Markets Tread Water

Dollar recovers in early US session, with help from better than expected job data. Yet, it remains the weakest one for the week at this point. Buying momentum for the greenback doesn't warrant a reversal yet. The forex markets are mixed for now, with mild weakness in Sterling and...

BoE Haldane: Ensuring a tool in the toolbox is remotely the same as deploying

BoE Chief Economist Andy Haldane said while the central bank is doing the work to ensure a tool is in the tool box, "that is not remotely the same as saying that we are about to deploy that tool." He added, "that will depend on the balance of costs...

Dollar and US Treasuries Dive Together, Funds Moving Out?

Dollar tumbles sharply today together with US treasuries. 10-year yield breaks above 0.8% handle but that's giving no support to the greenback. Instead, in a rather unusual development, Yen surges sharply at the same time. Stock futures are just steady. There are talks about the renewed hope for a...

BoE Ramsden: Negative rates certainly in the toolbox for potential future use

In a speech, BoE Deputy Governor Dave Ramsden talked about "the Monetary Policy Toolbox in the UK". QE is an "effective tool" for stimulating demand for 11 years of its use in the UK. There is "headroom" remaining and it's a "tried and tested tool" as "marginal policy tool...

Sunset Market Commentary

Markets The EU successfully auctioned 10y and 20y supranational social bonds to finance its €100bn SURE programme. The bonds carry a triple A rating. Demand was enormous, totaling over €230bn. From today’s auction, the EU plans to raise €17bn; the bulk (€10bn) from the sale of 10-year debt. The bonds...

Euro and Swiss Franc Rally as Markets Expect More Negative Rates Elsewhere

Markets continue to be dominated by strength of Euro and Swiss Franc today. That comes in spite of surging coronavirus infections in Europe. Meanwhile, the deadlock of Brexit negotiations remain. Traders are apparently adding to bet that more global central banks, like RBA and BoE, are joining the negative...

BoE Vlieghe: Risk to monetary policy skew towards additional stimulus

BoE External MPC member Gertjan Vlieghe said in speech, even though "policy rates and long-term interest rates are very low... investment is weak, vacancies are low". Risks to economic outlook are "skewed towards a longer period of labour market slack with weak inflationary pressure". Risks to monetary policy stance are...

U.K. Economy Underwhelms

Executive Summary Seemingly never ending uncertainty related to Brexit and a gut-wrenching battle against COVID-19 has wreaked havoc on the U.K. economy. Like most other economies, the U.K. economy began to bounce back in late spring/early summer. But, the recent rebound is threatened by a second wave of COVID-19...

Dollar Recovering as J&J Paused Vaccine Study, Aussie Tumbles

Dollar is trying to recover in Asian session while Aussie tumbles broadly. Sentiments appear to be turning cautious on news that Johnson & Johnson paused coronavirus vaccine study due to an unexplained illness in a participant. UK also started a tiered system of fresh coronavirus restrictions. WTI crude oil...

BoE Bailey: We haven’t addressed the question of using negative rates

BoE Governor Andrew Bailey said in a webinar yesterday that the central isn't ready for implementation of negative interest rate yet. "Given the shock we've had, there are good reasons to say we shouldn't rule them out and therefore they're in the toolbox," he said. "We haven't addressed the...

BoE Woods asking banks’ readiness for negative rates

BoE Deputy Governor Sam Woods sent as letter to banks asking for their readiness on negative interest, as it could be an option to take based on current situation. "We are requesting specific information about your firm's current readiness to deal with a zero Bank Rate, a negative Bank Rate,...

Euro Heads Lower in Indecisive Markets, Aussie Firmer

Commodity currencies are the main drivers in the markets today, as Australian Dollar leads others higher. European majors, on the other hand turn weaker as led by Euro. Dollar and Yen are mixed for the moments, awaiting the next move in risk markets. Global stock markets seem to have...

BoE Bailey: We are by no means out of firepower

BoE Governor Andrew Bailey said in a EU banking conference that the central bank is "by no means out of firepower". "In terms of our policy tools, and we will use that firepower as appropriate, properly and strongly in response to second and third waves, where we think it...

Yen Plummets Again on Surging Yields, Dollar Awaits FOMC Minutes

Yen had a U-turn today and breaks near term support level against Dollar. Resilience in treasury yield is seen as a factor for Yen's weakness. After a brief set back yesterday, US 10-year yield looks set to extend recent rally through 0.78 handle. German 10-year yield is also trying...

BoE Tenreyro: Productivity gain from WFH trend and online shopping

BoE policymaker Silvana Tenreyro said "work-from-home trend" could bring productivity gains in the medium term. Also, shift to online shopping could bring productivity gain too. For Europe, US and the UK, the risk is that "we undershoot inflation targets. Also, she warned, the the full recovery from the pandemic could be...

BoE Haskel ready to vote for more stimulus

BoE policymaker Jonathan Haskel said risks are skewed to the downside for UK's economy. "I stand ready to vote for more stimulus measures should they be needed", he said. Haskel also noted the positive effects of negative interest rates for Eurozone . "That said, the effectiveness is probably going to...

Weekly Economic and Financial Commentary: Recovery Keeps Trudging Along

U.S. Review Recovery Keeps Trudging Along In what was a jam-packed week of economic data, the jobs report, prospects of additional fiscal stimulus and the president's positive COVID-19 test result commanded markets' attention. Nonfarm employers added 661K jobs in September. But with layoff announcements coming from household-name companies this week,...

Markets in Range, Trapped by Low Month-End Volatility

The forex markets are generally staying in tight range today, without much reaction to better than expected job data from US and GDP from Canada. Nor was there much movements after comments from ECB President and BoE Chief Economist. Subdued month-end trading is keeping volatility very low. Nevertheless, it's...

BoE Haldane: None of the conditions of negative rates satisfied

BoE Chief Economist Andy Haldane said in a speech that the MPC minutes "contained no such signal" as it's introducing negative rates in the near-term. The operational feasibility assessment of negative rates is "likely to take a number of months". Then, judgement on negative rates will depend on the...

Sleepy Markets Yawn US Debate, Focus Back to Economic Data

Dollar and Yen recover some ground in Asian session but it's unsure if this week's pull back is completed yet. There were little reactions to the President debate of Donald Trump and Joe Biden. Asian markets are mixed despite some solid data out of China. DOW future is currently...

BoE Bailey: No judgement on whether to use negative interest rates yet

BoE Governor Andrew Bailey said in a speech to Queen's University Belfast that the economy has performed a bit stronger than expected. However, there are signs that recovery might not be as strong going forward. In Q3, economic activity was around -7% to -10% lower than pre-pandemic levels. Risks...

Sterling Jumps on BoE Comments, Dollar Softens as Stocks Rebound

Sterling rises broadly today after BoE Deputy Governor indicated that negative interest rate is not imminent. Rebound in the Pound somewhat lifts other European majors too. Australian Dollar is following as the second strongest for now, with help from rebound in stocks. Dollar is trading broadly lower, paring last...

BoE Ramsden sees 0.1% as effective lower bound in interest rates

Sterling is given a lift by BoE Deputy Governor Dave Ramsden's comment in an interview with the Society of Profession Economists. He said, "for me, I see the effective lower bound still at 0.1 which is where Bank Rate is at present". And, “we are not about to use...