Interbank market news scan: Central banks shouldn’t try to fight climate change …

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Central banks shouldn’t try to fight climate change, as doing so could endanger financial stability and undermine their independence, a top Czech monetary official said. Central Banks Can’t Fix Climate Change, Czech Policy Maker Says (msn.com)

The European Central Bank will pay the currency bloc’s 19 central banks 1.6 billion euros in dividends this year, down from the 2.4 billion euros it paid a year ago as its profit declined, it said in a statement on Thursday. ECB cuts dividend payment to euro zone central banks | Nasdaq

Deutsche Bank AG scaled back plans for its bonus pool after the European Central Bank objected to proposed payout levels, highlighting the challenges of rewarding top performers while heeding demands for restraint during the global pandemic. Deutsche Bank Cut Bonus Pool Plans After Criticism From ECB (msn.com)

Currency pairsExchange Rate as of 4:15 pm 16 February 2021(1) As of 12:54 pm EST Exchange Rate as of 18 February 2021(2)(3)
AUD/USD0.7762 0.7779
USD/CAD1.2694 1.2701
USD/CNY6.4567 6.4869
EUR/USD1.2126 1.2079
USD/INR72.6000 72.6500
GBP/USD1.3855 1.3948
USD/JPY104.9400 105.7300
USD/MXN19.9300 20.4150
USD/DKK6.1325 6.1593
USD/NOK8.4558 8.4637
BTC/USD  48,358.6000
ETH/USD  1,700.6400
Sources: Federal Reserve (1), Reuters-FX rates (2), OANDA-crypto rates

18 February 2021

Interbank market news scan: Central banks, foreign exchange; Peoples Bank of China not afraid of enough liquidity …

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Naci Agbal, Turkey’s new central bank governor, began his career as a financial inspector three decades ago. He hopes such devotion to the rules will see him – and the economy – through one of the trickiest turnaround jobs in emerging markets. NEWSMAKER-Back-to-basics Agbal hopes this time is different at Turkey’s central bank | Nasdaq

China provided medium-term funds to lenders on Thursday, giving banks some relief after its cash drainage last month triggered the country’s worst liquidity squeeze since 2015. China Rolls Over $31 Billion in Medium-Term Loans to Banks – Bloomberg

Zambia became the second country in the world to increase its benchmark interest rate this year as it seeks to bring down “spiraling” inflation that’s at a five-year high. Zambia Central Bank Hikes Rate to Fight Surging Inflation – Bloomberg

Weakness in both the dollar and euro is posing a dilemma for investors about which is the best source of funding for emerging-market carry trades. On balance, the U.S. currency is still first choice. Carry Traders Clash Over Which Major Currency Has Most to Lose – Bloomberg

New York Attorney General Letitia James announced on Wednesday her office has sued to shut down Coinseed, a cryptocurrency-trading app that prosecutors allege ignored securities laws and defrauded thousands of investors. NY AG sues to shut down crypto app Coinseed alleging it sold a worthless currency and defrauded investors (msn.com)

Economist Nouriel Roubini, known as “Dr. Doom” for his pessimistic market views, said “the Flinstones had a better monetary system than bitcoin” in an interview with Bloomberg Wednesday morning. The NYU professor argued bitcoin and other digital tokens shouldn’t even be considered currencies because they lack many of the basic traits currencies must possess. ‘Dr. Doom’ economist Nouriel Roubini says ‘the Flintstones had a better monetary system than bitcoin’ and the token should not be considered a currency (msn.com)

Currency pairsExchange Rate as of 4:15 pm 16 February 2021(1) As of 2:10 am EST Exchange Rate as of 18 February 2021(2)(3)
AUD/USD0.7762 0.7754
USD/CAD1.2694 1.2699
USD/CNY6.4567 6.4505
EUR/USD1.2126 1.2044
USD/INR72.6000 72.7270
GBP/USD1.3855 1.3851
USD/JPY104.9400 105.9000
USD/MXN19.9300 20.2248
USD/DKK6.1325 6.1742
USD/NOK8.4558 8.4960
BTC/USD  48,358.6000
ETH/USD  1,700.6400
Sources: Federal Reserve (1), Reuters-FX rates (2), OANDA-Crypto rates (3)

Interbank market news scan: Digital currency won’t replicate cash characteristics …

It would be misguided to expect cash-like features of a central bank digital currency, according to one of the monetary authorities furthest ahead in exploring such a system. Central Bank Digital Money Won’t Replicate Cash, Sweden’s Riksbank Says (msn.com)

Fluency, the UK-based fintech created by Polish emigrants, plans to sell its cryptocurrency banking business and focus on working with central banks’ digital currency efforts, newspaper Puls Biznesu reported on February 15. bne IntelliNews – Polish-UK fintech Fluency to focus on central banks’ digital currency

Democratic Republic of Congo’s economy grew 0.8% in 2020 on the back of strong performance in its mining sector, and is projected to grow 3.2% this year, a central bank advisor said on Tuesday. Congo’s economy grew 0.8% in 2020, to rise 3.2% this year, says central bank | Reuters

Bank of Governor Haruhiko Kuroda said on Tuesday the recent stock price rally reflected market optimism over the global economic outlook, brushing aside views its ultra-loose monetary policy was fueling an asset price bubble. BOJ’s Kuroda says stock boom reflects economic optimism, defends ETF scheme (cnbc.com)

With global demand returning and supply bottlenecks likely to drive up shipping, food and energy prices, Bank of America believes emerging market inflation could be on the horizon. BofA recommended buying currencies backed by hawkish central banks or a robust balance of payments — namely the Brazilian real, Chinese yuan, Czech koruna and South Korean won — along with oil exporters, most notably the Russian rouble and Russian equities. Bank of America names the emerging market currencies to back as inflation risks mount (cnbc.com)

Currency pairsExchange Rate as of 4:15 pm 8 February 2021(1) As of 12:36 pm EST Exchange Rate as of 16 February 2021(2)(3)
AUD/USD0.7656 0.7759
USD/CAD1.2781 1.2698
USD/CNY6.4664 6.4542
EUR/USD1.2035 1.2102
USD/INR72.8500 72.8160
GBP/USD1.3714 1.3905
USD/JPY105.4400 105.8800
USD/MXN20.1300 20.2100
USD/DKK6.1785 6.1383
USD/NOK8.5428 8.4407
BTC/USD  45,471.7000
ETH/USD  1,683.8900
Sources: Federal Reserve (1) ; Reuters-foreign exchange rates (2); OANDA-crypto rates (3)

Interbank market news scan: Australian central bank wants to see a tighter labor market …

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Australia’s central bank believes it will take a significant and sustained tightening in the labor market to lift inflation to more comfortable levels, a tough task that could take years to achieve. Australia’s central bank says tighter labor market will lift inflation (cnbc.com)

A body representing cryptocurrency and blockchain stakeholders in Nigeria has joined other crypto industry players in assailing the recent Central Bank of Nigeria (CBN) directive to banks. The CBN order, which seeks snuff out crypto entities from the banking system, took effect on February 5, 2020. Nigeria Crypto Ban: Stakeholder Body, Politicians Assail Central Bank’s Directive to Financial Institutions – Emerging Markets Bitcoin News

Indonesia’s central bank is seen trimming its benchmark rate for the first time this year on Thursday, on top of the five rate cuts it has delivered since the start of the coronavirus pandemic, according to a majority of analysts in a Reuters poll. Indonesia’s central bank seen making this year’s first rate cut | The Star

As cryptocurrencies increasingly go mainstream, pressure is growing on the world’s biggest central banks to move forward with their plans to issue digital cash and fend off private sector threats to traditional money. Bitcoin’s mainstream charge raises stakes for central bank digital cash – Technology – Dunya News

Currency pairsExchange Rate as of 4:15 pm 8 February 2021(1) As of 12:23 am EST Exchange Rate as of 16 February 2021(2)(3)
AUD/USD0.7656 0.7803
USD/CAD1.2781 1.2619
USD/CNY6.4664 6.4542
EUR/USD1.2035 1.2139
USD/INR72.8500 72.6320
GBP/USD1.3714 1.3939
USD/JPY105.4400 105.5800
USD/MXN20.1300 19.9410
USD/DKK6.1785 6.1255
USD/NOK8.5428 8.3658
BTC/USD  45,471.7000
ETH/USD  1,683.8900
Sources: Federal Reserve (1) ; Reuters-exchange rates (2) ; OANDA-cryptocurrency (3)

16 February 2021

Interbank market news scan: Central banks and Foreign exchange …

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Central banks in emerging economies are set to move in different directions this year: Some remain in an easing mode and are expected to lower borrowing costs further, with Bloomberg Economics predicting cuts in China, Indonesia, India and Mexico. Emerging-Market Central Banks Are Set for a Hawkish Turn (msn.com)

Climate activists are warning that central banks are taking a “risky gamble” with their strategies for addressing the financial risks from global warming. Central Banks Criticized for Risky Gamble on Climate Fight (msn.com)

The truth about capital flows is worth revisiting and remembering as economists, media members and politicians continue to waste so much brain space and emotion on the doings of central banks. They’re mistaken. Central banks quite simply do not matter. Jack Ma’s Ant Group Further Exposes The Fed And Central Banks As Afterthoughts (forbes.com)

India’s foreign exchange reserves declined by $6.240 billion during the week ended February 5. According to the Reserve Bank of India’s (RBI) weekly statistical supplement, the reserves decreased to $583.945 billion from $590.185 billion reported for the week ended January 29. India’s foreign exchange reserves plunges by over $6 bn (sify.com)

The amount of money repatriated by Filipinos abroad fell last year for the first time since 2001 as the pandemic upended the global job market. Philippine Remittances See First Drop Since 2001 (msn.com)

The safe-haven dollar started the week near two-week lows on Monday, as optimism about COVID-19 vaccine rollouts and a planned $1.9 trillion U.S. stimulus package drove up riskier currencies and stock markets across Europe and Asia. Dollar weakens as market optimism lifts riskier currencies | Reuters

Currency pairsExchange Rate as of 4:15 pm 8 February 2021(1) As of 9:30 am EST Exchange Rate as of 15 February 2021(2)(3)
AUD/USD0.7656 0.7782
USD/CAD1.2781 1.2658
USD/CNY6.4664 6.4542
EUR/USD1.2035 1.2123
USD/INR72.8500 72.6140
GBP/USD1.3714 1.3895
USD/JPY105.4400 105.3900
USD/MXN20.1300 19.9260
USD/DKK6.1785 6.1259
USD/NOK8.5428 8.4119
BTC/USD  45,583.4000
ETH/USD  1,743.7500
Sources: (1) Federal Reserve ; (2) Reuters-currency rates; (3) OANDA-crypto rates

15 February 2021

Interbank market scan: Central Banks and Foreign Exchange … and the year of the Ox.

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In a sign of continued maturity as a macro asset, bitcoin now looks to be leading the price action in the foreign exchange markets (FX). Bitcoin Starting to Lead FX Markets, Analysis of Tesla Reaction Shows: Report – CoinDesk

Group of Seven finance ministers are expected on Friday to back a new allocation of the International Monetary Fund’s own currency, or Special Drawing Rights, to help low-income countries hit by the coronavirus pandemic. GRAPHIC-Which countries would benefit most from an IMF SDR increase (msn.com)

World shares dipped on Friday as investors awaited progress towards more U.S. fiscal stimulus, while the dollar was set for a weekly loss and cryptocurrency Bitcoin hit a record high. World shares dip and Bitcoin hits record high – Metro US

Currency pairsExchange Rate as of 4:15 pm 8 February 2021(1) As of 12:31 pm EST Exchange Rate as of 12 February 2021(2)
AUD/USD0.7656 0.7725
USD/CAD1.2781 1.2694
USD/CNY6.4664 6.4542
EUR/USD1.2035 1.2124
USD/INR72.8500 72.6000
GBP/USD1.3714 1.3855
USD/JPY105.4400 104.9500
USD/MXN20.1300 19.9320
USD/DKK6.1785 6.1496
USD/NOK8.5428 8.4958
Sources: Federal Reserve (1) ; Reuters (2)

Interbank market news scan: Central banks and inequality …

While the economic recovery around the world remains uneven, fragile, and unbalanced across sectors, financial markets are generally doing very well, thanks! In the United States, only half of the unemployment caused by the pandemic last year has been reversed, while stock markets continued to boom. Of course, this largely reflected the extraordinary support given by monetary authorities since March last year. Central Banks and Inequality – Economic News, Analysis, and Discussion (thestreet.com)

Interest in bitcoin and other cryptocurrencies may be surging, but central banks don’t want to be left behind by financial innovation. In fact, more than 80% are examining how to launch digital versions of their own currencies. Why central banks want to launch digital currencies (msn.com)

Mexico’s central bank on Thursday cut its benchmark interest rate for the first time since September, flagging uncertainty over the economic outlook and global efforts to tackle the COVID-19 pandemic. Mexico Central Bank Cuts Interest Rates, Says Outlook Uncertain | Investing News | US News

Currency pairsExchange Rate as of 4:15 pm 8 February 2021(1) As of 12:38 pm EST Exchange Rate as of 11 February 2021(2)
AUD/USD0.7656 0.7749
USD/CAD1.2781 1.2689
USD/CNY6.4664 6.4542
EUR/USD1.2035 1.2121
USD/INR72.8500 72.7080
GBP/USD1.3714 1.3820
USD/JPY105.4400 104.6800
USD/MXN20.1300 19.9915
USD/DKK6.1785 6.1327
USD/NOK8.5428 8.4619
Sources: Federal Reserve(1) ; Reuters(2)

11 February 2021 8:41 pm EST

Interbank market news scan: Can central banks play social justice warrior? Are traders prepared for a rate increase?

Banks now tackle diverse issues, be it Covid-19, climate change or inequality. Purists may disagree but there’s no other option. Central banks aren’t what they used to be – and the better for it | Business | The Guardian

After standing shoulder-to-shoulder for much of the pandemic, traders are preparing for the day the world’s central banks begin to move apart on policy. Traders Map Out Day When Central Banks Finally Raise Rates (msn.com)

Lawmakers in Brazil vote to grant their central bank autonomy. Brazil passes law giving autonomy to central bank | Financial Times (ft.com)

A top Bank of Canada official called the recent spike in cryptocurrency prices “speculative mania,” and said such assets don’t have the qualities to become the money of the future. Crypto Boom Is ‘Speculative Mania,’ Bank of Canada Deputy Says (msn.com)

Sudan’s new cabinet faces pressure to push through rapid currency reform or risk endangering its path to debt relief and to international financial support for its shaky political transition, diplomats and analysts say. Analysis: Delay in currency reform puts donor support for Sudan at risk | Reuters

Currency pairsExchange Rate as of 4:15 pm 8 February 2021(1) As of 3:31 am EST Exchange Rate as of 11 February 2021(2)
AUD/USD0.7656 0.7744
USD/CAD1.2781 1.2676
USD/CNY6.4664 6.4557
EUR/USD1.2035 1.2124
USD/INR72.8500 72.7700
GBP/USD1.3714 1.3830
USD/JPY105.4400 104.5800
USD/MXN20.1300 19.9970
USD/DKK6.1785 6.1332
USD/NOK8.5428 8.4650
Sources: (1) Federal Reserve, (2) Reuters

Interbank market scan: Lagarde sees holding crypto as “unlikely.” Central Bank of Nigeria explains “no to crypto.” India pursues crypto law

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European Central Bank President Christine Lagarde on Wednesday said she didn’t consider bitcoin to be a real currency, adding that central banks won’t be holding it as reserve currency anytime soon. ECB president Christine Lagarde says it’s ‘very unlikely’ that central banks will hold bitcoin in the near future (msn.com)

Following its ban on cryptocurrency-related transactions in the country, the Central Bank of Nigeria has explained why it was done. CBN  boss disclosed that the digital currency is used for money laundering and terrorism. CBN explains why cryptocurrency transactions were banned (withinnigeria.com)

Kingsley Moghalu, former deputy governor of the Central Bank of Nigeria (CBN) has condemned the apex bank’s reason for stopping cryptocurrency transactions in the country. Moghalu condemns CBN’s reason for banning cryptocurrency transactions (withinnigeria.com)

On Tuesday (February 9), minister of state for finance Anurag Singh Thakur said that a cryptocurrency bill was being finalised and it would be sent to Union Cabinet soon. Cryptocurrency bill: Here’s what you need to know (msn.com)

Are central banks on the verge of a currency war with the U.S? Global central bank interventions raise specter of ‘currency war’ | Morningstar

“Bitcoin needs a couple more big endorsements, and that could be the key to take prices above the $50,000 level,” Edward Moya, senior market analyst for the foreign-exchange broker Oanda, wrote Tuesday.  First Mover: As Wall Street Fixates on Inflation Hedges, Good Luck Finding Bitcoin | Nasdaq

Bitcoin ‘can’t be stopped’: Nigerians look to peer-to-peer exchanges after crypto ban. Some Nigerians plan to continue using bitcoin and other cryptocurrencies despite a directive issued by the Central Bank of Nigeria last week ordering banks to close down accounts associated with cryptocurrencies. First Mover: As Wall Street Fixates on Inflation Hedges, Good Luck Finding Bitcoin | Nasdaq

The Federal Reserve Board on Tuesday announced the second extension of a rule to bolster the effectiveness of the Small Business Administration’s (SBA) Paycheck Protection Program (PPP). Like the earlier extensions, this one will temporarily modify the Board’s rules so that certain bank directors and shareholders can apply to their banks for PPP loans for their small businesses. Federal Reserve Board – Federal Reserve Board announces the second extension of a rule to bolster the effectiveness of the Small Business Administration’s Paycheck Protection Program (PPP)

Currency pairsExchange Rate as of 4:15 pm 8 February 2021 As of 1:00 pm EST Exchange Rate as of 10 February 2021
AUD/USD0.7656 0.7727
USD/CAD1.2781 1.2690
USD/CNY6.4664 6.4576
EUR/USD1.2035 1.2134
USD/INR72.8500 72.8500
GBP/USD1.3714 1.3841
USD/JPY105.4400 104.6600
USD/MXN20.1300 20.0543
USD/DKK6.1785 6.1317
USD/NOK8.5428 8.4504
Sources: Federal Reserve, Reuters

10 February 2021

Interbank market news scan: Central banks, foreign exchange, cryptocurrencies …

Currency pairsExchange Rate as of 8 February 2021; Source: Federal ReserveAs of 11:42 am EST Exchange Rate as of 9 February 2021; Source: Reuters
AUD/USD0.7656 0.7708
USD/CAD1.2781 1.2721
USD/CNY6.4664 6.4348
EUR/USD1.2035 1.2093
USD/INR72.8500 72.8420
GBP/USD1.3714 1.3795
USD/JPY105.4400 104.6500
USD/MXN20.1300 20.0765
USD/DKK6.1785 6.1502
USD/NOK8.5428 8.4728
Sources: Federal Reserve, Reuters

In the news ….

The latest crackdown by Nigeria’s central bank on cryptocurrency has elicited outrage and confusion in a country where virtual currency has boomed in the last five years. It’s also emblematic of the struggle by financial regulators the world over to regulate the supercharged space of digital currencies. https://qz.com/africa/1970446/nigerias-central-bank-takes-aim-at-cryptocurrency-again/

China’s central bank has downplayed its decision in January to reduce liquidity in the banking system that caused the country’s worst cash crunch in nearly six years, while fueling worries about a gradual tightening of monetary policy to curb speculation and asset bubbles. https://www.scmp.com/economy/china-economy/article/3121179/chinas-central-bank-downplays-draining-funds-banking-system

Chinese New Year is days away and for many investors, it is the most exciting event this week, especially with a light economic calendar. It is not as big a holiday as Christmas or New Year’s, but with more than 1.5 billion celebrants, there will be less participation and possibly consolidation. Most of the major currencies traded higher on Monday as stocks hit fresh record highs. The improvement in risk appetite drove the U.S. dollar lower across the board. https://www.investing.com/analysis/central-banks-and-stimulus-bets-will-drive-fx-this-week-200559371