Federal Reserve Chairman Ben S. Bernanke said the U.S. recovery, while being sustained by private demand, isn’t as strong as he prefers and faces risks from Europe’s debt crisis that may require further Fed action. U.S. growth is “not as fast as we would like,” Bernanke told the House Budget Committee in testimony today just hours [...]

Euro Zone, global markets, Interest rates, unemployment, US Hide

President Barack Obama is poised to increase the U.S. debt to a level that exceeds the value of the nation’s annual economic output, a step toward what Bill Gross called a “debt super cycle.” The CHART OF THE DAY tracks U.S. gross domestic product and the government’s total debt, which rose past $13 trillion for the first [...]

bonds, debt, dollar, Interest rates, recovery, unemployment, US Hide

Westpac Banking Corp., Australia’s second-biggest lender, said fiscal first-half profit climbed 32 percent, joining the nation’s top banks in posting higher earnings as markets recover and fewer borrowers miss repayments. Net income in the six months ended March 31 rose to a record A$2.88 billion ($2.6 billion) from A$2.18 billion in the same period a [...]

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Investor Marc Faber said China’s economy will slow and possibly “crash” within a year as declines in stock and commodity prices signal the nation’s property bubble is set to burst. The Shanghai Composite Index has failed to regain its 2009 high while industrial commodities and shares of Australian resource exporters are acting “heavy,” Faber said. The opening [...]

bubble, China, housing, Interest rates, investments, reserves, stock market Hide

Euro-region ministers agreed to a 110 billion-euro ($146 billion) rescue package for Greeceto prevent a default and stop the worst crisis in the currency’s 11-year history from spreading through the rest of the bloc. The first payment will be made before Greece’s next bond redemption on May 19, said Jean-Claude Juncker after chairing a meeting of euro-region [...]

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Have you ever wondered why Chinese monetary policy always increases rates by 18 or 27 bps? An article by Bloomberg in May 2007 clears the air on this. The People’s Bank of China today raised its one-year benchmark lending rate by 0.18 percentage point and its one-year depositrate by 0.27 percentage point. Why 18 or 27 [...]

China, Interest rates Hide

A short posting to clarify the few commonly used terms in interest rates as they can be confusing! Fed Fund Effective Rate – All US banks maintain reserves at the Fed. If reserves of Bank A run below the legal minimum, A may borrow funds from B (these funds are also held in reserve at [...]

Fed Funds, Interest rates, LIBOR Hide

Indonesia’s central bank may refrain from raising interest rates from a record low this week, betting that inflation isn’t yet enough of a threat to require higher borrowing costs. Bank Indonesia will keep its reference rate unchanged at 6.5 percent for an eighth straight month tomorrow, according to 16 of 17 economists in a Bloomberg [...]

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March 30 (Bloomberg) — Greek seven-year notes fell in the first day of trading and an auction of 12-year bonds garnered demand for less than half the debt offered on concern Europe’s most indebted nation will keep struggling to fund itself. The drop drove yields on the 5 billion euros ($6.7 billion) of seven-year notes [...]

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China’s yuan is facing increasing pressure to appreciate because of a widening interest-rate differential, the country’s top currency regulator said in a statement. Speculative capital is flowing into China disguised as foreign direct investment and trade accounts through “underground money shops,” Yi Gang, head of the State Administration of Foreign Exchange, said at a briefing in Beijing [...]

China, forex, Interest rates, UK Hide