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Interest Rates, Local interest rate discussions
early birds
post Posted: Today, 08:41 AM
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The RBA will be less concerned with inflation and more concerned with monetary stimulus

Australia inflation increased to 0.8% QoQ in Q2 from 0.6% in Q1. However, the continued persistence of the Delta variant in Australia remains a worry. Although Melbourne has just come out of a 5 Day lockdown, Sydney remains in lockdown indefinitely. Therefore, the RBA will be less concerned with inflation and more concerned with monetary stimulus. The RBA meets next week and after decreasing the amount of weekly bond purchases from A$5 billion to A$4 billion at the previous meeting, the central bank may have to reverse course and actually begin buying once again to help support the economy.

On the same day the Australia released its CPI, the US FOMC met. Despite the Fed statement saying that progress has been made towards goals for tapering, the press conference told a completely different story. Chairman Powell said that “we’re some ways away from substantial progress on jobs.” He noted that they look at several metrics when looking at jobs data, but he also said that the 5.9% Unemployment Rate is too high. Hence, the asset purchase program will continue at the current pact of $120 billion per month for the foreseeable future.

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as we all know this is vary good opportunity to bring back little bit of normality to the really twisted world financial system now , as inflation met all those central banks target.
but, what they try to do?????? WTF



 
early birds
post Posted: Jul 27 2021, 09:37 AM
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https://www.sharecafe.com.au/2021/07/26/inf...-friend-or-foe/

Inflation: Friend or Foe?

Governments like a bit of inflation. Central banks think they can achieve it. It’s the rest of us who will have to deal with the consequences if they can’t. lmaosmiley.gif

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so true!!

i only can think of words
"be careful what you wish for"



 
early birds
post Posted: Jul 26 2021, 09:46 AM
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https://www.sharecafe.com.au/2021/07/25/dia...ngs-gotta-give/

According to Moody’s, Wednesday will see a 3% annual inflation rate for the June 30 financial year – while a forecast of 3.9% has come the AMP’s chief economist, Shane Oliver.


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it's from our own sharecafe

don't think RBA will tightening in near future...as every other central banks keep printing day and night.. weirdsmiley.gif



 
early birds
post Posted: Jul 24 2021, 09:59 AM
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In Reply To: early birds's post @ Jul 22 2021, 08:41 AM

U.S. Treasury Secretary Janet Yellen urged Congress to act quickly to raise the debt ceiling and avert a payment default that could happen this fall. Data shows that the European recovery could be at risk from so-called reopening inflation. Here’s your markets wrap.

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weirdsmiley.gif same old tricks that works all the time..............well , until it's not!!
keep printing!!!

 
early birds
post Posted: Jul 22 2021, 08:41 AM
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In case Congress wasn’t preoccupied enough, the U.S. is at risk of a default in October or November unless it raises or suspends the debt limit, the Congressional Budget Office said. The debt ceiling—how much the government can borrow—is a favorite partisan grenade on Capitol Hill. Democratic senators have already rejected any attempt by Republicans to set conditions for increasing the federal debt limit, while the debate is causing angst for money market traders.

===================== from bloomberg

no worry, just lift the up side limits will do!! keep printing!! weirdsmiley.gif





 
early birds
post Posted: Jul 16 2021, 09:21 AM
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Last weekend, ECB President Christine Lagarde said that there will be changes to the guidance at next week’s European Central Bank meeting in order to reassure traders that policy will not be tightened too quickly. The ECB recently announced in its strategic review that their inflation target will be 2% over the medium term. The reason for the change in guidance: Inflation is expected to be over 2.5% towards the end of the year. In other words, they expect the inflation to be transitory. Europe releases June’s Final CPI data on Friday and although the headline is expected to be near 1.9%, the core rate of inflation is only expected to be 1%. If the final inflation data on Friday comes in hotter than expected, Christine Lagarde and the committee may have to reconsider their language next week. July’s preliminary CPI reading isn’t due out until August 18th.


Then there is the RBA. At the July 6th RBA meeting, although they reduced bond purchases to A$4 billion per week from A$5 billion per week, the committee said they do not expect actual inflation to be within their 2%-3% target until 2024 One of the reasons for this expectation of such a long duration until inflation reaches target is that the Delta variant of the coronavirus is making its rounds in Australia. Sydney has been in full lockdown since June 26th, and the lockdown is expected to last until the end of July. Now, the state of Victoria is entering a lockdown of its own, albeit only 5 days. (Victoria was on a nearly 4-month lockdown last year).

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i'm not sure how many chances all those central banks will get, to tightening up money supply so world economy can back on it's own feet and walk on "normal" path , going forward ?????? unsure.gif
until something like "after pay " exploded ??? WTF


 


nipper
post Posted: Jul 13 2021, 10:02 AM
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In Reply To: early birds's post @ Jul 13 2021, 09:55 AM

this was an interesting one... pulling out all stops to keep afloat the inefficient aspects of economies.
QUOTE
The statement by the People's Bank of China, when announcing the reason for the RRR cut, was rather interesting.

To support the real economy...and in light of rising costs for micro and small businesses caused by increasingly higher commodity prices this year.

I am not sure how you interpret that but it sounds like the Chinese authorities are concerned about a slowing economy and rising prices.

There is a horrible word for that combination.

We all know that China was the first in and the first out of the COVID crisis and now it is telling us that they see trouble ahead.

In addition, we should recall that China's banking regulator, the CBIRC, has been sending out some cautionary signals for a while.

In March this year, Guo Shuqing, head of the CBIRC, warned of bubbles in the west and in late May his deputy gave a similar warning talking of excessive debt levels, financial market bubbles and inflation.


Is China battening down the hatches?

.

.
.

stagflation ????



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"Every long-term security is nothing more than a claim on some expected future stream of cash that will be delivered into the hands of investors over time. For a given stream of expected future cash payments, the higher the price investors pay today for that stream of cash, the lower the long-term return they will achieve on their investment over time." - Dr John Hussman

"If I had even the slightest grasp upon my own faculties, I would not make essays, I would make decisions." ― Michel de Montaigne

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early birds
post Posted: Jul 13 2021, 09:55 AM
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https://www.sharecafe.com.au/2021/07/12/asi...e-policy-shift/

“We think the larger than expected universal RRR cut is likely to reinforce market expectations that PBOC is determined to keep liquidity stable, which will support risk sentiment in the near term,” economists at OCBC Bank, wrote on Monday.

Citigroup on Monday said the potential pressure on banks in loan pricing, credit demand and asset quality as the unexpected RRR cut “May signal the economic recovery could be weaker than expected.”

European Central Bank President Christine Lagarde caught markets by surprise on Monday saying the bank will change its guidance on policy at its next meeting and show it is serious about reviving inflation.

The ECB’s new strategy allows it to tolerate inflation higher than its 2% goal when rates are near rock bottom. That’s similar to the new monetary policy stances of the Reserve Bank in Australia and the US Federal Reserve.

Fed chair Jay Powell is due to testify before the US Congress on Wednesday and Thursday and after the June Consumer Price Index data is released tonight (Tuesday).

America’s June quarter reporting season kicks off tonight with JPMorgan and Goldman Sachs due to release what analysts say will be strong results thanks to the absence of the big loan loss provisions seen a year earlier in the June, 2020 quarter.

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from our own sharecafe.

it just shows when comes to central banks, no matter they are commies or westerns they all do the same thing-------print more paper money!! blush.gif


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early birds
post Posted: Jul 7 2021, 09:11 AM
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https://www.sharecafe.com.au/2021/07/06/qui...pering-process/

The Reserve Bank has made a small step towards restoring monetary policy to a normal footing by starting the tapering of its quantitative easing bond purchases to $4 billion a week for the next five months.

That’s a $1 billion a week or 20% cut in the size of the projected purchases over the next five months.

As expected, the Reserve Bank kept interest rates unchanged at 0.10% at its July monetary policy meeting yesterday; maintained the April, 2024 bond as its target for the three-year yield control policy but trimmed its weekly bond purchases (or quantitative easing.

The current $100 billion round of bond purchases is due to end in September.

Reserve Bank Governor Philip Lowe said that “the step-down from $5 billion to $4 billion does not represent a withdrawal of support (for the economy) by the RBA.

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hope it wont be too later when the times come that inflation runs wild...... unsure.gif


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early birds
post Posted: Jul 5 2021, 08:39 AM
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Economics Wrap: Crunch Time for the RBA

https://www.sharecafe.com.au/2021/07/04/eco...me-for-the-rba/

“Moreover, the recent disruptions caused by localised outbreaks, although likely to be temporary, will increase the odds of the central bank expanding its current quantitative easing program by undertaking a third round of bond purchases in the coming months.”

And the AMP’s Chief economist, Shane Oliver wrote in his weekly note at the weekend expects to see “the Bank ease up on some of its emergency stimulus measures but remain pretty dovish in view of the threat posed by the latest coronavirus outbreaks and lockdowns.”
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from our own sharecafe!!


https://www.afr.com/policy/economy/economis...20210702-p5868q

The majority of forecasters in The Australian Financial Review’s June-quarter survey of economists do not think the Reserve Bank will lift the cash rate from its 0.1 per cent level at least until 2023 but most expect the central bank will begin to lighten its other monetary tools, the preconditions for a future rate rise.

“The simple fact is the RBA has significantly underestimated the strength of the economic recovery, both globally and domestically,” said Tim Toohey, Yarra Capital’s head of macro and strategy.

Su-Lin Ong from RBC Capital Markets said: "The case for some tapering remains despite the current COVID-19 situation."

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from financial review!!



 
 


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