SNB & CHF

Defying the expectations a few months ago, Greece remained in the Economic and Monetary Union.  It recently succeeded in implementing sufficient reforms to earn another tranche of aid.   However, the entire exercise exhausted whatever trust there may have been.  It has also further soured Greece's attitude toward the EU. This leaves officials ill-prepared to deal with other issues.   The refugee challenge is such an issue.  The Financial Times reported that some EU officials are...

Defying the expectations a few months ago, Greece remained in the Economic and Monetary Union.  It recently succeeded in implementing sufficient reforms to earn another tranche of aid.   However, the entire exercise exhausted whatever trust there may have been.  It has also further soured Greece's attitude toward the EU. This leaves officials ill-prepared to deal with other issues. The refugee challenge is such an issue.  The Financial Times reported that some EU officials are...

The anticipation is nearly over.  The softer than expected preliminary EMU inflation figures encourages expectations for the more aggressive range of actions by the ECB tomorrow.  Draghi has claimed that movement toward the inflation target was too slow.  Today's data showed a 0.1% increase year-over-year in the headline rate.  The market had anticipated a 0.2% increase.  Although the ECB targets headline inflation, it clearly also tracks core inflation.  Core price increases slowed to...

Canada reported its monthly GDP estimate for September, and at the same time, provided its first estimate of Q3 GDP.   The Great Graphic, created on Bloomberg, shows both time series. The monthly GDP is depicted by the yellow line and the quarterly estimate is the white line.  Clearly they track each other, as one would expected.   The good news is that after contracting in the first two quarters of the year, the Canadian economy expanded by 2.3% in Q3. The bad news is that the growth...

(Here is a draft of a monthly column I write for a Chinese paper) It is official.  The Chinese yuan will be in the SDR.  At a 10.4% share, it is a bit more than I expected, but less than the 14%-16% share that the IMF staff has intimated a few months ago.  This is a significant event, even if there is no short-term market opportunity.   The yuan’s exchange rate against the dollar has steadily declined over the month of November contrary to conspiracy theories that warned Chinese...

(Here is a draft of a monthly column I write for a Chinese paper) It is official.  The Chinese yuan will be in the SDR.  At a 10.4% share, it is a bit more than I expected, but less than the 14%-16% share that the IMF staff has intimated a few months ago.  This is a significant event, even if there is no short-term market opportunity.   The yuan’s exchange rate against the dollar has steadily declined over the month of November contrary to conspiracy theories that warned Chinese...

The US dollar is trading with a heavier bias today amid some last minute position squaring ahead of the key events of the week, which are stacked in the second half.  The ECB meeting and US jobs data are the two most important events in a jam packed week for most participants.   The recent pattern has been for new lows in the euro to be greeted with a bit of profit-taking.  This pattern is holding.  New lows were made yesterday just below $1.0560, and short-covering lifted it to nearly...

Nuclear waste experts are looking for possible sites for deep geological repositories for atomic waste and are using vibrator vehicles that generate weak seismic waves. (SRF/swissinfo.ch) --- swissinfo.ch is the international branch of the Swiss Broadcasting Corporation (SBC). Its role is to report on Switzerland and to provide a Swiss perspective on international events. For more articles, interviews and videos visit swissinfo.ch or subscribe to our YouTube channel: Website:...

Unless you’re living under a rock, you know that we have an administered interest rate. This means that the bureaucrats at the Federal Reserve decide what’s good for the little people. Then they impose it on us. In trying to return to freedom, many people wonder why couldn’t we let the market set the interest rate. After all, we don’t have a Corn Control Agency or a Lumber Board (pun intended). So why do we have a Federal Open Market Committee? It’s a very good question. Someone asked it...

I had the privilege of being on CNBC to discuss the significance of China being included in the IMF's Special Drawing Right. Here is the link to the discussion.  The decision was announced shortly after the interview on CNBC.  It was largely a foregone conclusion that China would join.  Besides the confirmation, the new news was in the weighting.   China's yuan got an almost 11% share of the new SDR that will be launched 1 October 2016.  The room for the yuan comes comes mostly at the...