Central Bank

The Reserve Bank of Australia (RBA) has left interest rates on hold at an historic low of 1.5% as widely expected and flagged that some "slowing in the year-ended growth rate is likely" before picking up again.
The RBA has cut rates twice this year, in May to 1.75 per cent and in August to its current historic low. The last time the official cash rate increased was November 2010.
All 64 economists polled by Reuters expected the RBA to keep rates on hold at today’s meeting, the last of the year.

After nearly seven years from the end of the deepest global financial crisis of the postwar period, growth continues to be slow in advanced countries and falling in most emerging market economies. There is even the risk that the world may be drifting toward a new global financial crisis and even secular stagnation. These are the issues examined in this paper.

The Federal Reserve could raise U.S. interest rates "relatively soon" if economic data keeps pointing to an improving labor market and rising inflation, Fed Chair Janet Yellen said on Thursday in a clear hint the U.S. central bank could hike next month.

"Such an increase could well become appropriate relatively soon," Yellen said in prepared remarks that were her first public comments since the United States elected Republican Donald Trump to be the country’s next president.

The Swiss National Bank is ready to take policy measures as and when they are necessary to keep the country’s inflation and economy on track, two top policymakers underlined on Wedsneday.

SNB Vice Chairman Fritz Zurbruegg said currency market interventions had become an increasingly important tool since the financial crisis and the euro zone debt crisis had pushed up the safe-haven Swiss franc.

"Since last January our monetary policy framework is based on two elements. The first is negative interest rates… and the second element, which is important to underscore, is a willingness to intervene on foreign exchange markets as necessary," Zurbruegg said at a UBS banking conference.

The Swiss National Bank will continue annual payments of 1 billion Swiss francs ($1.02 billion) to Switzerland’s 26 cantons and the federal government according to a new 5-year pact announced on Thursday over how to divide the central bank’s profits.

The new agreement runs through 2020; the SNB will make up for any omitted or reduced profit distributions if its distribution reserve is in positive territory.

The Swiss government rejected a popular initiative that would transform the monetary system and end fractional-reserve banking, according to its dispatch to Parliament, on Wednesday.

The government said the "sovereign money" proposal to end fractional-reserve banking would complicate the SNB’s monetary policy and put the Swiss economy at risk.

US dollar is overvalued and that investors would do well to move out of that currency. In the long run the national debt, which is currently 106% of GDP, and the balance of payments deficit, currently running at about 40 to 45 billion dollars a month, are unsustainable. Of course the US is the largest single economy globally and has huge reserves of coal, oil and gas besides extensive farming land. So it is not to be expected that the US dollar is going to collapse. It could soon however gradually lose 20% to 30% of its current value.

This year has been full of surprises. Commodity prices kicked things off with a steep and unexpected drop before steadily rebounding. Then Brexit happened – or the vote did, at least. The political pandemonium has been prolonged since, with Donald Trump closing in on presidential rival and early-favourite Hilary Clinton.