Rumors have been spreading across trading floors that the Fed may lower the penalty for using its dollar liquidity swap line to reduce stress in the interbank market. As I mentioned in a previous note, a 100bp ‘penalty’ over the overnight indexed swap (OIS) rate for the Fed’s dollar liquidity swap line is preventing the […]
Archive:
ECB
Since the announcement of Europe’s unprecedented rescue package late last night, the Euro rallied to as high as almost 1.31/USD off of a low of 1.2529 on May 6th. However, as the dust settles from Europe‘s nuclear option to address the continents widening debt crisis, lingering risks are reemerging as the Euro shows signs of weakness […]
ABC News (Australia)is reporting that, “A Reserve Bank official says the head of the European Central Bank, Jean-Claude Trichet, is leaving a Sydney meeting of central bankers early to attend an ECB council meeting.” I expect this means investors could anticipate some market moving news related to troubled EU nations over the next few days.