SKorean central bank keeps key rate at 2.5 percent

U.S. fiscal health worse than Europe's: China adviser
“we should be clear in our minds that the fiscal situation in the United States is much worse than in Europe” The U.S. dollar will be a safe investment for the next six to 12 months because global markets are focused on the euro zone's troubles but America's fiscal health is worse than Europe's, an adviser to the Chinese Central Bank said on Wednesday. Li Daokui, an academic member of the central bank's Monetary Policy committee, said that U.S. bond prices and The Dollar would fall when t...

Bank of England keeps rate intact
Published: Dec. 9, 2010 at 11:26 AM LONDON, Dec. 9 (UPI) -- The Bank of England will maintain its current low Interest Rate for overnight loans at 0.5 percent, keeping its Lending policy consistent since March 2009. The Central Bank also left its asset purchasing program intact, bank officials said. The BOE began asset purchases in March 2009, most recently increasing its target for purchases to $315 billion in November 2009. The bank withholds details of its Monetary Policy decisions for three ...

Asian economies: Importing pessimism
WAL-MART in China is not quite like Wal-Mart elsewhere. Its stores sell live turtles and toads. It is happy for its staff to join a union. And in Kunming, a southern city in which Wal-Mart has six shops, the company, as well as several of its competitors, must now report and justify any price increases to the government 48 hours in advance. This policing of prices is part of China’s unorthodox fight against Inflation, which is running at more than 4% a year. Rising prices are also discomfi...

Bank of Korea says economic growth to slow in 2011
South Korea's Central Bank says the country's economy is set to slow to a more normal level in 2011 following its strong recovery from the global Financial Crisis. The Bank of Korea said Friday that Asia's fourth largest economy will expand at a rate of 4.5 percent next year compared with an expected 6.1 percent in 2010. The Central Bank made the estimates in its Economic Outlook report for 2011. South Korea's growth has rebounded strongly this year after sputtering to a meager 0.2 percent expan...

Bond-market demonization watch, eurozone edition
Did you know there’s a fight to the death going on in Europe? The NYT covers it today, under the headline “Central Bank and Financiers Fight Over Fate of the Euro.” Let’s see if we can spot a theme here: On one side is the European Central Bank, which is spending billions to prop up Europe’s weak-kneed Bond Markets… On the other side are Hedge Funds and big Financial Institutions that are betting against those same bonds… The war keeps escalating as traders...

Reserve Bank Of Australia Stands Pat On Cash Rate
SYDNEY -- The Reserve Bank of Australia kept its key cash rate on hold at 4.75% on Tuesday, as widely expected. The Central Bank said that, following its decision last month to lift the key cash rate by 25 basis points and subsequent increases in rates by Financial Institutions, Lending rates in The Economy are now a little above average. "The board views this setting of Monetary Policy as appropriate for the Economic Outlook," it said. The Australian dollar traded at 98.92 U.S. cents after the ...

The world economy: Three-way split
THIS year has turned out to be a surprisingly good one for the world economy. Global output has probably risen by close to 5%, well above its trend rate and a lot faster than forecasters were expecting 12 months ago. Most of the dangers that frightened Financial Markets during the year have failed to materialise. China’s economy has not suffered a hard landing. America’s mid-year slowdown did not become a Double-Dip Recession. Granted, the troubles of the euro area’s peripheral...

Bank of England Keeps Rates Unchanged
The Bank of England said Thursday that it decided to keep its emergency stimulus program unchanged and the Central Bank's key Lending rate at its record low of 0.5%. The bank's Monetary Policy Committee also left its asset purchase program unchanged at £200 billion ($315 billion). Minutes from the previous meeting showed a three-way split over the direction of monetary policy, with some in favor of raising rates to tame Inflation, and others in favor of more stimulus to encourage growth...

BoE keeps rates at 0.5 percent, makes no change to QE
London | Thu Dec 9, 2010 7:18am EST London (Reuters) - The Bank of England's Monetary Policy Committee voted to keep Interest Rates unchanged and make no new quantitative easing purchases after its monthly meeting on Thursday, in line with market expectations. None of the more than 60 Economists polled by Reuters last week had expected a change to the 0.5 percent interest rate and 200 billion pounds ($317 billion) of total asset purchases that have been in place since February. Despite a bail...

SKorean central bank keeps key rate at 2.5 percent
South Korea's Central Bank has kept its key Interest Rate on hold after raising it last month amid Inflation worries. The Bank of Korea announced Thursday that it decided to leave the benchmark seven-day repurchase rate at 2.5 percent during a monthly Monetary Policy meeting. The increase in November from 2.25 percent was the second in four months. Thursday's decision was widely expected. All Economists at 16 Financial Institutions surveyed by Yonhap Infomax, the financial news arm of Yonhap new...

Ryan Takes Aim at the Federal Reserve
In a little noticed Speech this week, Rep. Paul Ryan took direct aim at the Federal Reserve, calling for a rethink of American Monetary Policy.  Not since Ron Paul called for an “End to the Fed” has a Republican representative so strongly criticized the Federal Reserve’s mission. Ryan spoke December 7th at a panel discussing “Sound Money and America’s Global Economic Leadership” organized by the Atlas Economic Research Foundation and FreedomWorks.  There Ryan

It Depends What Victory Is
Matthew Yglesias doesn’t think South Korea’s recent statements of deterrence against the North sound credible. Read Robert Farley, but dwell particularly on the fact that not only would a successful ROK/DPRK war be costly for the ROK in terms of losses, but the curious fact that victory itself would be a disaster for South Korean living standards. Ask a (West) German someday about the cost of reunification, and consider that the task facing Korea would be an order of magnitude more...

Brazil's GDP grows 6.7 percent in third quarter
The government says Brazil's Third Quarter gross domestic product was 6.7 percent higher than in the same period one year earlier. The IBGE statistics bureau said Thursday that industrial production grew 8.3 percent compared to the Third Quarter of 2009, while agriculture increased 7 percent and the Service Sector 4.9 percent. The growth of Brazil's economy led the Central Bank keep the country's benchmark Interest Rate at 10.75 percent to keep a lid on Inflation, which reached 5.63 percent in t...

Chinese Rate Hike Rumblings
, quoted Ba Shuson, a researcher with the State Council's Development Research center, who said that China's Inflation in November may have peaked at a stunning 4.8%. He also added that "it will take time for the government’s measures to fight price gains to take effect." Of course the government would actually have to institute measures to fight price gains: if the just released Australia Payrolls number is accurate, Chinese inventory stockpiling hit an all time high this month, and in ex...

America's Low Interest Rates Have a High Hidden Price
Interest Rates are the price of money, and though that price is near zero right now, the cost of low interest rates to our society as a whole may be getting too high. It's widely accepted that such low interest rates are the only way to revive a struggling economy. But what if those widely accepted views are wrong? What if ultra-low interest rates have Unintended Consequences that outweigh their benefits? If the popular wisdom were right, The Economy would have revived by now. In the meantim...

Something Republicans and Democrats Agree On: Their Hatred of the Fed
These days, it's pretty hard for Republicans and Democrats to agree on pretty much anything. But a new poll from Bloomberg shows that they see eye-to-eye on one issue: their hatred of the Federal Reserve. While broad public discontent with the Fed isn't shocking news, the aggressive action Americans believe should be taken according to the poll shows they want big changes. Americans across the political spectrum say the Fed shouldn't retain its current structure of independence. Asked if the ce...

Majority of Americans Say Fed Should Be Reined In or Abolished, Poll Shows
A majority of Americans are dissatisfied with the nation’s independent Central Bank, saying the U.S. Federal Reserve should either be brought under tighter political control or abolished outright, a poll shows. The Bloomberg National Poll underlines the extent to which the central bank’s standing has suffered as it has come under fire in Congress, first from Democrats for regulatory lapses before the Financial Crisis and then from Republicans for failing to revive an economy in which t...

Barclays Sees Potent Brew for Growth
By Brenda Cronin It’s out with the fears of a Double Dip and in with cautious optimism for the world economy next year, Barclays Capital said in the firm’s Global Outlook for 2011. Supportive Monetary Policy and slowly improving economic conditions will prove a “potent brew” for growth, said Larry Kantor , Managing Director and Head of Research, in presenting the outlook Thursday in New York. The firm predicts U.S. gross domestic product will expand at an annual rate of ...

Draghi warns on bond purchases
European Central Bank action to calm tensions in Eurozone bond markets must remain firmly controlled, otherwise the euro’s monetary guardian risks “losing everything we have”, one of its most ­senior policymakers has warned. Mario Draghi, Italy’s Central Bank Governor, says in an interview with the Financial Times that large-scale purchases of Government Bonds could threaten the ECB’s freedom to act without political interference and break European Union rules. “I&#

Pressure builds on EU leaders for more action on debt
Brussels (Reuters) - European Union leaders meet next week under pressure to take bolder steps to quell the Euro zone Debt crisis, despite signs that Volatility in European Bond Markets is abating toward the end of the year. The European commissioner for monetary affairs, Olli Rehn, said it was time for Europe to show proper coordination, and back its shared currency union with closer economic union. "We have to take well-coordinated action to safeguard stability in the Euro area," Rehn said on...

Q&A;: University funding
Ministers have voted for plans to allow universities in England to charge Tuition fees of up to £9,000 per year, amid major Budget cuts to institutions' teaching budgets. The proposal was the government's response to the independent review of Higher Education funding by former BP chief Lord Browne, who recommended completely lifting the cap on the Tuition fees. What is the government's policy? The government has pushed through plans to allow universities to charge up to £9,...

Americans Still Worry Whether Fed Can Keep Inflation, Interest Rates Down
[...] A new Rasmussen Reports national telephone survey finds that just 38% of Adults are at least somewhat confident the Federal Reserve Board will be able to keep Inflation under control and Interest Rates down, with 10% who are Very Confident. Fifty-five percent (55%) do not share that confidence, including 17% whoa re Not At All Confident. (To see survey question wording, click here.) Eighty-percent (80%) of adults nationwide are at least somewhat concerned about inflation, including 51% who...

Mortgage rates rise for fourth week
A bank-owned home for sale is seen in Denver on March 6, 2009. UPI/Gary C. Caskey WASHINGTON, Dec. 9 (UPI) -- Average Interest Rates for long-term Mortgages rose for the fourth consecutive week, the U.S. Federal Home Loan Mortgage Corp. said Thursday. The average interest rate for 30-year fixed-rate Mortgages rose from 4.46 percent to 4.61 percent with 0.7 points. Average Interest Rates for 15-year contracts rose from 3.81 percent to 3.96 percent with 0.7 points, Freddie Mac said. Rates for 15-y...

Reserve Bank Of New Zealand Keeps Cash Rate At 3%
SYDNEY -- The Reserve Bank of New Zealand said Thursday that it has left its official cash rate on hold at 3.0%. "Interest Rates are now projected to rise to a more limited extent over the next two years than signalled in the September statement," said Reserve Bank Governor Alan Bollard. "Continued household and business caution suggests current low interest rates are having a less stimulatory effect than in the past," he added. Bollard said that the recent Earthquake in Canterbury appears to ha...

Price Stability Is An Economically Dangerous Fad
Amid the very reasonable handwringing about the Fed’s charitably naïve attempts to stimulate The Economy through “Quantitative Easing”, there’s an understandable drive among some Fed critics to severely reduce its mandate. Specifically, the Fed can’t create jobs as its defenders inside and outside the Central Bank presume, so better it would be limit its role to that of Inflation Watchdog. All that is fine on its face, but in seeking to redefine the Fed’s...