Posts Tagged: Quantitative Easing

Despite the growth registered yesterday, the Euro started to fall once more due to the concerns related to Slovakia’s approval of the EFSF, which has generated a new wave of risk aversion. Slovakia is the last European country to vote in the matter of the expansion of the bailout fund which is meant to contain the sovereign debt crisis. The news which has generated these concerns arose from one of the ruling parties in the Slovak government which has announced the intention of abstaining from voting the EFSF expansion deal. This actually means that, in order to be able to support this bailout fund, the officials in the Slovak government are to be forced to seek for support in the opposition. Moreover, the fact that Slovakia, which is the last country in the Eurozone to vote for the EFSF expansion deal, is now confronted with this type of problems actually means that the final decision on the bailout Read more »

This has been an important week for the Euro due to the fact that there were risks according to which the European currency is going to be faced with a tremendous fall due to the fact that the sovereign debt crisis continues to be important in the region and to the speculations regarding the European Central Bank’s decision concerning the interest rates.

The decision of the European Central Bank has been taken today and it was that of maintaining the same value of the interest rates, but of expanding the program of bond purchases. The announcement of this decision has caused the Euro to fall at the beginning, but the European currency has managed to rebound afterwards. The European Central Bank has announced today the fact that it leaves its target Minimum Bid Rate at the value of 1.50 percent, decision which has been forecasted by most of the market’s analysts, even though there have been some of Read more »

The European Crisis seems to have a negative effect even upon the Great Britain Pound, one of the most powerful currencies in the European Union, the one which has almost arrived to be considered as a safe-haven based on the problems all the other countries are facing. Despite this good evolution although the year, it seems now that even the situation of the Great Britain Pound is getting worse due to the fact that the European crisis has had an effect upon the local economy as well.

Based on these facts, the Great Britain Pound has now faced the fourth consecutive weekly decline against the US Dollar and the Japanese Yen. This fall has been caused by the release of the macroeconomic data which indicates the fact that the nation’s economy is not going so well. This poor fundamental data increased the speculations according to which the UK Central Bank is going to be required to embark Read more »

The Australian Dollar is one of the currencies which have managed to score the greatest gains against the US Dollar since 2010. It was at the end of last year’s August, after the announcement of the quantitative easing round two of the Jackson Hole summit held by the Federal Reserve that the Aussie started to spectacularly raise against the US Dollar. Since that moment, the AUD added as much as 18 percent against its US counterpart. But now, when the quantitative easing has come to an end, meaning that its balance sheet is to be slowly expanding over the next several months, and when the Reserve Bank of Australia is probably to take the decision on maintaining its interest rates at the actual value of 4.75 percent, it is very likely that the situation will change in favor of the greenback.

The participants to the trading market tend to believe that the Reserve Bank of Australia is to Read more »

Federal Reserve Chairman Ben Bernanke has said that additional monetary stimulus may be warranted because inflation is too low, while the unemployment rate is far too high in the United States on Friday.

“There would appear, all else being equal, to be a case for further action,” Bernanke said today during a speech given at the Boston Fed conference. Bernanke also said that the US Central Bank could expand purchases of various assets, but added that nonconventional policies have costs and limitations that must be taken into account in judging and how aggressively they could be used.

Bernanke and the Fed governors are presently considering ways they can stimulate the US economy as unemployment stays near 10 percent and inflation falls short of the Central Banks goals. The Fed has lowered interest rates just over zero and has bought over $1.7 trillion of securities since the financial crisis began, but policy makers are discussing expanding the Fed’s balance Read more »