Brexit makes Carney less of a central bank oddity 1 Aug 2019 Bank of England boss Mark Carney is, like everyone, in the dark about whether Britain will crash out of the EU. Without that uncertainty, he might be tightening policy when peers are either easing or hinting they might. Being odd man out would be better than the current limbo.
Jerome Powell finds another way to please nobody 31 Jul 2019 The Fed chief presided over a quarter-point interest-rate cut on Wednesday, disappointing investors, presumably the president, and even some colleagues. Most people have enough worries, real or not, to want lower borrowing costs. Most economic statistics, though, say not yet.
Hong Kong fills best worst job in central banking 26 Jul 2019 As the new head of the HKMA, Eddie Yue is on track to get a salary that puts U.S. Fed chief Jay Powell in the shade. A pegged currency means he needn’t fret much about rate-setting or attacks on his independence. The catch: if problems really escalate, he has fewer tools.
Markets want to see colour of Mario Draghi’s money 25 Jul 2019 The European Central Bank chief opened the door to even looser monetary policy. The dearth of decisions or details meant the euro reversed initial losses while bond and stock prices gave up brief gains. He will have to deliver on his big promises before investors give him credit.
Swiss currency ticks towards new showdown 22 Jul 2019 The franc hit a two-year high against the euro. Policy interest rates are already negative so cutting them further may fail to dent its strength. A return to major intervention risks U.S. ire. Traders will take advantage of central bank boss Thomas Jordan’s bind.
Seoul rate-setters bat for trade accord with Tokyo 18 Jul 2019 A surprise cut to borrowing costs underscores growth concerns as South Korea faces export curbs from its neighbour. The central bank has little more space to ease. That puts the onus on President Moon Jae-in to pass a stimulus package and to de-escalate regional tension.
New UK banknote just about passes Turing test 17 Jul 2019 With cash use shrinking and high denominations favoured by crooks, there are reasons to scrap big bills. But a revamp of the 50-pound note, picturing the mathematician, is intelligent enough. Unlike, say, 500 euros, it still fits a system shifting slowly to digital payments.
China’s awkward rate-setting status quo to persist 12 Jul 2019 The central bank may want to half-follow a U.S. rate cut expected later this month. Yet officials have been looking to scrap the benchmark rate that offers the most direct way to do so. With so much at stake, however, the current half-reformed setup could prove tough to shake.
New breed of central bankers is harder to read 11 Jul 2019 Jerome Powell at the Fed and Christine Lagarde, nominated to be the next ECB chief, are lawyers by training. Their thinking is more fluid than predecessors whose economic tenets informed a world view. That has benefits, but also means it’s harder to predict how they will react.
Hadas: Bond markets lost in inflation-growth gap 10 Jul 2019 Changing growth expectations explain most daily movements in bond prices, while falling inflation parallels the long-term trend of declining yields. Every so often, however, market gyrations reflect hopes that growth and inflation will reconnect. There’s little sign of that.
Deutsche creditors give ECB charity short shrift 9 Jul 2019 The banks regulator is aiding the German lender’s revamp by letting it run on a lower capital ratio. In response, Deutsche Bank’s hybrid bond yields spiked. A botched overhaul would be bad for creditors – and also the central bank’s credibility.
Global central bank assault claims Turkish victim 7 Jul 2019 Desperate to boost growth, President Tayyip Erdogan has fired the country’s central bank chief. He’s the latest casualty of a worldwide attack on independent monetary authorities. The blow to confidence makes any cut in the main rate, held at 24% since September, more damaging.
Review: The conundrum of no good jobs 5 Jul 2019 Low unemployment in the U.S. and UK hides a grimmer reality, economist David Blanchflower argues in his new book. Weak wage growth and widespread despair have prompted people to turn to populist leaders. He makes a compelling case for why policymakers can still rev up growth.
Bond markets keep raising bar for central bankers 4 Jul 2019 Global yields are falling with benchmark German ones at record lows. Investors expect more monetary policy easing on both sides of the Atlantic. That will come but the scale and speed of market moves mean rate-setters will have to work hard to meet ever-rising expectations.
Time to look beyond Europe for next IMF boss 3 Jul 2019 The international lender’s chief has always been European. Christine Lagarde’s exit will be a chance to drop the outdated convention. Any hope of salvaging the multilateral system means giving emerging and developing economies more clout. Competence matters more than nationality.
Viewsroom: What makes companies proud of Pride? 27 Jun 2019 Neither profit nor investor pressure explain U.S. firms lining up to mark 50 years of the LGBT-rights movement. They may simply be doing the right thing. But the nation still has a long way to go. Plus: how the UK prime minister race affects the Bank of England’s next boss.
New Zimbabwe dollar heading same way as old one 25 Jun 2019 Robert Mugabe’s successor has banned day-to-day use of foreign currency to promote a new local dollar. Crucially, there are no guarantees against the money-printing that killed its predecessor. Without adequate reserves, exports or popular support, the new unit is likely to fail.
Boris Johnson may spice up UK central bank race 24 Jun 2019 The frontrunner to succeed Prime Minister Theresa May tends to stray from the script. That increases the chances of an unconventional candidate replacing Mark Carney as the head of the Bank of England. If Johnson makes the pick, it could even be his most lasting legacy.
Big Tech warrants Bank of England’s open eyes 21 Jun 2019 The central bank may let technology firms deposit funds alongside regular lenders as Governor Mark Carney seeks to keep up with rapid shifts in finance. Lower costs and more competition are broadly positive. Large groups like Facebook, however, deserve a more cautious embrace.
Buybacks prolong Wall Street rally nobody loves 20 Jun 2019 U.S. stocks are near record highs – thanks in part to purchases by their issuers. Investors are pulling out of equities and fund managers report extreme bearishness amidst a weakening global economy. Hopes of Fed rate cuts are a fragile support when it’s the only game in town.