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For those expecting the US Dollar Index, which has a heavy weighting based on the Dollar/Euro exchange rate, to soon signal a weakening US Dollar in the face of record fiscal deficits, perhaps patience will be tested yet again.
"Least Ugly" is taking on a whole new complexion. Will the Euro fall back to test par with the US Dollar this year? :eek:Is the Swissie really a "safe haven" any more [is the Swiss economy large enough to allow the SNB and the Swiss government to afford to bail out its banking system if necessary]?And in the latest installment in the "race to the bottom" soap opera...
"Least Ugly" is taking on a whole new complexion. Will the Euro fall back to test par with the US Dollar this year? :eek:
Trichet Propelled Toward Zero Rate by Deepening Slump
Jan. 12 (Bloomberg) -- The sliding European economy is propelling European Central Bank President Jean-Claude Trichet toward the zero-interest-rate world he sought to avoid.
A month after saying he didn’t want to be “trapped” with borrowing costs too low, Trichet may be caught with them too high, as the euro-region’s economy sinks faster than the ECB foresaw in December. As the bank’s governing council prepares to meet Jan. 15, caution from Trichet might prove costly, saddling Europe with a longer recession and weaker recovery than the U.S. faces.
“The economy is in a potentially dangerous situation,” says Gilles Moec, a London-based economist with Bank of America Corp. and former Bank of France official. “There is still a case for very aggressive action from the ECB.”
Accelerating job cuts and declining investment may shrink the economy of the 16 nations that share the euro by 2.5 percent this year, according to Bank of America and Deutsche Bank AG. That’s five times the rate of contraction the ECB staff projected last month.
The slide puts pressure on the ECB to follow the U.S. Federal Reserve, the Bank of Japan and the Bank of England by dropping its key interest rate to unprecedented levels...
...data show Europe’s slump turning much worse. Services and manufacturing shrank last month by the most in at least a decade, and confidence among consumers is the weakest on record. Inflation fell below the ECB’s target of just under 2 percent for the first time since August 2007...
...The 22-member governing council meets in Frankfurt after having slashed its key rate by 1.75 percentage points since early October, to 2.5 percent. Economists expect a half percentage-point cut, to 2 percent, at this week’s meeting...While that would match the lowest rate in the bank’s 10-year history -- reached in 2003 -- it would still leave the ECB with the highest benchmark rate among major central banks...
...The European slide has steepened so rapidly that the ECB’s month-old forecasts of a 0.5 percent contraction this year and a 1.4 percent inflation rate already “look very unrealistic,” says Silvio Peruzzo, an economist at Royal Bank of Scotland Group Plc...
Jan. 12 (Bloomberg) -- The sliding European economy is propelling European Central Bank President Jean-Claude Trichet toward the zero-interest-rate world he sought to avoid.
A month after saying he didn’t want to be “trapped” with borrowing costs too low, Trichet may be caught with them too high, as the euro-region’s economy sinks faster than the ECB foresaw in December. As the bank’s governing council prepares to meet Jan. 15, caution from Trichet might prove costly, saddling Europe with a longer recession and weaker recovery than the U.S. faces.
“The economy is in a potentially dangerous situation,” says Gilles Moec, a London-based economist with Bank of America Corp. and former Bank of France official. “There is still a case for very aggressive action from the ECB.”
Accelerating job cuts and declining investment may shrink the economy of the 16 nations that share the euro by 2.5 percent this year, according to Bank of America and Deutsche Bank AG. That’s five times the rate of contraction the ECB staff projected last month.
The slide puts pressure on the ECB to follow the U.S. Federal Reserve, the Bank of Japan and the Bank of England by dropping its key interest rate to unprecedented levels...
...data show Europe’s slump turning much worse. Services and manufacturing shrank last month by the most in at least a decade, and confidence among consumers is the weakest on record. Inflation fell below the ECB’s target of just under 2 percent for the first time since August 2007...
...The 22-member governing council meets in Frankfurt after having slashed its key rate by 1.75 percentage points since early October, to 2.5 percent. Economists expect a half percentage-point cut, to 2 percent, at this week’s meeting...While that would match the lowest rate in the bank’s 10-year history -- reached in 2003 -- it would still leave the ECB with the highest benchmark rate among major central banks...
...The European slide has steepened so rapidly that the ECB’s month-old forecasts of a 0.5 percent contraction this year and a 1.4 percent inflation rate already “look very unrealistic,” says Silvio Peruzzo, an economist at Royal Bank of Scotland Group Plc...
UBS May Post $7.2 Billion Loss for Fourth Quarter, SZ Reports
Jan. 11 (Bloomberg) -- UBS AG may post an 8 billion-franc ($7.2 billion) loss for the fourth quarter of 2008, SonntagsZeitung reported, without saying where it got the information.
Such a result would take the bank’s full-year deficit to more than 20 billion francs, making it the biggest Swiss corporate loss, the Zurich-based newspaper wrote.
Jan. 11 (Bloomberg) -- UBS AG may post an 8 billion-franc ($7.2 billion) loss for the fourth quarter of 2008, SonntagsZeitung reported, without saying where it got the information.
Such a result would take the bank’s full-year deficit to more than 20 billion francs, making it the biggest Swiss corporate loss, the Zurich-based newspaper wrote.
Ruble Falls to 6-Year Low as Russia Devalues 2nd Time in 2 Days
Jan. 12 (Bloomberg) -- Russia's ruble slid to the weakest level in almost six years against the dollar as the central bank devalued the currency for the second day amid declining oil prices...
...“After the long holiday the central bank’s come back intent on showing they’re still on a devaluation path,” said Ulrich Leuchtmann, head of currency strategy at Commerzbank AG in Frankfurt, which rates itself one of the top 10 traders of the ruble in the world...
...The ruble may retreat 10 percent against the basket this month as companies and banks buy foreign currency to repay more than $80 billion of debt this year, according to Societe Generale SA. Danske Bank A/S in Copenhagen sees a 15 percent drop in the ruble by year end...
...Bank Rossii, the central bank, has devalued the currency 14 times since Nov. 11...
...The nation, which is the world’s largest energy exporter, has depleted its foreign-currency reserves by 27 percent since the start of August as the central bank sought to mitigate the currency’s slide...Russia’s currency basket is made up of about 55 percent dollars and the rest euros.
Jan. 12 (Bloomberg) -- Russia's ruble slid to the weakest level in almost six years against the dollar as the central bank devalued the currency for the second day amid declining oil prices...
...“After the long holiday the central bank’s come back intent on showing they’re still on a devaluation path,” said Ulrich Leuchtmann, head of currency strategy at Commerzbank AG in Frankfurt, which rates itself one of the top 10 traders of the ruble in the world...
...The ruble may retreat 10 percent against the basket this month as companies and banks buy foreign currency to repay more than $80 billion of debt this year, according to Societe Generale SA. Danske Bank A/S in Copenhagen sees a 15 percent drop in the ruble by year end...
...Bank Rossii, the central bank, has devalued the currency 14 times since Nov. 11...
...The nation, which is the world’s largest energy exporter, has depleted its foreign-currency reserves by 27 percent since the start of August as the central bank sought to mitigate the currency’s slide...Russia’s currency basket is made up of about 55 percent dollars and the rest euros.
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