FOMC to Highlight Weakness in Economy and Reinforce Dovish Stance in April Meeting
Following unprecedented measures announced in March, we expect the Fed to leave the policies unchanged at the April meeting. The focus will be on the economic assessment and the forward guidance. We expect the members to acknowledge the rapid deterioration...
BOC Extends QE to Provincial and Corporate Bonds, while Leaving Rate at Lower Bound
After three cuts, 150 bps in total, in March, BOC left the policy rate unchanged at 0.25% at the April meeting. With the policy rate standing at the lower effective bound, the central bank added further monetary easing by extending...
BOC to Stand on Sideline this Week. Unscheduled Policy Announcement Possible in Near Future
Having cut the policy three times and announced QE program in March, BOC will likely keep the powder at the April meeting. Policymakers will explain the rationale of the stimulus measures, reinforcing that the policies are essential to containing the...
FOMC Minutes Revealed Rationale for Emergency Cuts and QE Inifinity
As noted in the FOMC minutes for the March emergency meeting, the members agreed that economic situation has “deteriorated sharply” in light of the coronavirus pandemic. They were also in “strong support” of the measures to facilitate the flow of...
Aussie Gained as RBA Hinted the Possibility of Easing the Pace of QE
As widely anticipated, RBA left the cash rate unchanged at 0.25% in April. This is following two emergency rate cuts (50 bps in total) a month ago. The central bank pledged to maintain the stimulus measures announced last month for...
Manufacturing PMI and Inflation in the Eurozone Reveal that Eurozone is Approaching Recession
Latest indicators for virus-haunted Eurozone’s economic developments suggest that the region is very close to recession. While accelerating QE, ECB refrained from lowering the policy rate March. We expect it would be obliged to do so in April. Meanwhile, coordinated...
Global Central Banks Rushed to Stimulus Amidst Limited Monetary Policy Tools
As the coronavirus pandemic could very likely lead the world to recession, global central banks have rushed to inject liquidity through rate cuts another other unconventional measures. However, interest rates have already stayed at very low levels before the crisis....
RBNZ Announced QE to Tame Tightening Market Conditions
RBNZ announced QE on Monday, following an aggressive emergency rate cut, by -75 bps, to 0.25% last week. The surprising move aims at soothing the credit conditions which have tightened significantly over the past weeks. Besides QE, the central bank...
RBA Announced Emergency Rate Cut, Initiated QE
RBA announced an emergency rate cut of -25 bps, sending the cash rate to 0.25%, today. The central bank also announced a QE-style yield curve control plan. It attempts to target the yield for 3-year government bond at 0.25% through...
Fed and RBNZ Announce Emergency Cuts, BOJ to Follow?
In a very surprising move, FOMC has implemented another emergency cut, the second time in two weeks, to combat the negative impacts of the coronavirus outbreak. Originating in China, the virus has officially evolved into a pandemic affecting almost 100...