Posts Tagged ‘interest rates’
Correlation between interest rates and volatility
Correlation between interest rates and volatility, part 2
We have begun to see in the past article the existing correlation between the interest rates of the market and the volatility. We try now to illustrate better this consideration asserting that usually in the moments in which there is an crescent difference between the interest rates between the nations, this has carried to a reduced volatility forex. (more...)Correlation between interest rates and volatility, part 3
Correlation between interest rates and volatility, part 3
Tags: currency, Foreign Exchange, Forex, interest rates
Currency Trading
The exchange rate or Prices are determined by a number of factors, including economic and political conditions of the issuing country among the important. Political stability, inflation and interest rates all influence the price any currency. On the other hand, governments may seek to control the price of its currency and is flooding the market (to lower prices) or buying extensively (to raise prices). Read the rest of this entry »
Tags: currency, economic, Eur / Usd, interest rates, the Exchange
Economic Summary of the week
Let’s see what are the macro economic data were released during last week. The day of Monday, being the day after Easter, has seen very little published data, since most of the market was just closed for the holiday period.
Tags: central bank, currency, economists, economists' forecasts, interest rates
Approaches to the formation of the Central Bank interest rates
In a single state interest policy has its own unique structure. The main instruments of interest policy of the central bank are the basic refinancing rate and the rate of transactions in the financial market. The refinancing rate during the evolution of the monetary system has become more performance indicators, giving the economy a landmark value of the national currency in the medium term. Although, of course, can not deny the fact that the refinancing rate has a significant influence on the level of interest in the economy.
Interest rates on central bank operations in the financial market (hereinafter - the rate of Operations) - operational tool of interest policy. For him the bank conducts transactions in the financial market, refinance and withdrawal of liquidity from banks, thereby forming a rate of return on various financial market segments.
Tags: bank, financial markets, interest rate policy, interest rates, Monetary policy, the refinancing rate
Monetary policies must evolve
From 1945 to early 1970, the intervention framework of monetary policy was largely determined by the rules established in the famous conference of Bretton Woods in 1944. Each country committed to maintain a fixed parity between its currency and the U.S. Dollar, the latter engaging in the same time ensuring the convertibility into gold.
However, the excessive growth of monetary base in dollars generated by policies increasingly expansive related to public expenditure - the Vietnam War in particular - have shattered this stability. This resulted in an inconvertible dollar, inflation rampant and finally a general floating currencies. Hence the collapse of Bretton Woods in the mid 70s.
But the government did not want the consequences of the disappearance of the monetary discipline. It was not until the early 1980s to see more widespread adoption of a target for price stability.
All central banks have, in effect, the objective of nominal stability for achieving this is the condition of preservation of purchasing power to those who are keepers.
The central banks then used the main instrument available to them, the interest rates that set the terms of the interbank money market. By their actions, they set and price conditions and optimal allocation of bank liquidity.
Moreover, in modern economies characterized by the increasing importance of capital markets, direct influence is exerted primarily on interest rates in the short term. However, investment decisions or expense of economic agents are often determined by the rate of long-term interests (including real estate purchases). The potential influence of central banks in this area are much more limited and restrictive, at least if they remain in a treaty. Read the rest of this entry »
Tags: capital markets, financial system, interest rates, the banks
Norway, Sweden and New Zealand, new foci of interest
The Norwegian krone, Swedish krona and the New Zealand dollar turned in recent times very attractive currency for investors.
These coins are undergoing a period that has made them rise up to 10% against the dollar since June 2009.
Major European currency specialists are conducting their recommendations to these currencies. For example, Deutsche Bank, the largest global trader of currencies, has placed the Swedish and Norwegian krona and the New Zealand kiwi its main investment recommendations. Goldman Sachs, meanwhile, this month raised the price outlook for the three currencies. And BNP Paribas, also believes the scenario is favorable to these currencies. Read the rest of this entry »
Tags: interest rates, of money, The foreign exchange market, the market
The euro is undeterred by the ECB forecasts
ECB President, Mr. Trichet spoke and this time was to raise growth forecasts for the eurozone. However, the Community currency could not retrieve the dimension of $ 1.43, or wearing green at its intersection with the pound sterling. Read the rest of this entry »
Tags: exchange, interest rates, the currencies, the euro.
The euro’s strength and competitiveness of the eurozone
In recent years the euro has appreciated against other currencies in a fairly constant but not free from temporary fluctuations.
The appreciation of the euro, however, reduces the competitiveness of European countries against the rest of the world. Read the rest of this entry »