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October 21, 2012

Global Monetary Policy Week in Review – Oct. 20, 2012



The past week in monetary policy saw interest rate decisions by four emerging market central banks, with Thailand cutting its rates, Chile and Egypt holding rates steady, and Turkey holding rates but effectively easing policy by trimming the top rate of its interest rate corridor.


     Thailand’s rate cut was the only real surprise, with the bank seeking to bolster domestic demand to make up for exports that are suffering from weaker global demand. 

     Apart from Egypt, the banks noted the improved sentiment in global financial markets, including the euro zone, but Chile said it was still uncertain how Europe’s new policy measures would be implemented and tensions could flare up in months ahead.

     Turkey, whose exports are still rising, narrowed its interest rate corridor for the second month, but is being very cautious about easing as inflation is significantly above the central bank’s target.

LAST WEEK'S MONETARY POLICY DECISIONS:
COUNTRYMSCINEW RATEOLD RATERATE 1 YEAR AGO
THAILANDEM2.75%3.00%3.50%
TURKEYEM5.75%5.75%5.75%
CHILEEM5.00%5.00%5.25%
EGYPTEM9.25%9.25%8.25%

 NEXT WEEK (Week 43) is busy on the central banking front, featuring decisions by 11 central banks, including the Bank of Canada, the Federal Reserve, New Zealand, Sweden and Mexico.

COUNTRYMSCIDECISIONCURRENT RATERATE 1 YEAR AGO
SRI LANKAFM22-Oct7.75%7.00%
CANADADM23-Oct5.75%5.75%
UNITED STATESDM24-Oct0.25%0.25%
NAMIBIA24-Oct5.50%6.00%
GEORGIA24-Oct5.75%7.25%
NEW ZEALANDDM24-Oct2.50%2.50%
SWEDEN25-Oct1.25%2.00%
PHILIPPINESEM25-Oct3.75%4.50%
FIJI25-Oct0.50%1.50%
MEXICOEM26-Oct4.50%4.50%
TRINIDAD & TOBAGO26-Oct2.75%3.00%


About The AuthorCentral Bank News is dedicated to provide timely, and comprehensive global central banks news and policy developments (EconMatters author archive here.)

The views and opinions expressed herein are the author's own, and do not necessarily reflect those of EconMatters.

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Item Reviewed: Global Monetary Policy Week in Review – Oct. 20, 2012 Rating: 5 Reviewed By: EconMatters