Exchange rate
Hryvnia back from brink despite central bank U-turn
Central bank manages to stem Ukrainian currency’s free-fall despite adding to market chaos with volte-face on foreign exchange controls; two failed banks enter liquidation
Israel and Turkey cut rates, hinting at further easing
Bank of Israel eases with one eye on the appreciating shekel; Turkey stands by its ‘cautious’ stance on interest rate cuts with 25bp reduction
Azerbaijan devalues currency by a third
Central bank follows up last week’s decision to abandon its peg in favour of a currency basket by devaluing the manat by 34% against the US dollar
Central Bank of Nigeria abandons FX window
Latest attempt to halt the sliding currency sees central bank cease to offer foreign exchange auctions, but interventions continue in the interbank market
Jordan laments ‘significantly overvalued’ franc
Some of the ‘overshooting’ that occurred in the wake of the SNB’s decision to withdraw its currency cap has been corrected, but Jordan argues the franc is still too strong
PBoC report reveals extent of liquidity interventions
Quarterly monetary policy report reveals massive injections of liquidity to support the money supply as outward capital flows continue to accelerate
Venezuela fleshes out details of new floating exchange rate
Venezuela’s central bank will introduce a new free-float exchange rate, allowing people and companies to freely buy and sell dollars; economists say it will lead to depreciation
Belarus eyes policy overhaul
National Bank of the Republic of Belarus says it will exercise ‘tight control’ over the money supply in an effort to shackle inflation; questions over where this leaves exchange rate peg
Ukrainian hryvnia drops 30% after central bank action
Currency in freefall after National Bank of Ukraine scraps subsidised forex auctions and simultaneously increases its key discount rate by 550bp
Denmark cuts rate for third time in 11 days
Danish central bank cuts its deposit rate for the third time since the Swiss National Bank decided to abandon its exchange rate commitment; rate now sits at -0.5%
Venezuela to adopt new currency exchange system
Venezuela’s president announces changes to the country’s three-tiered currency exchange system, adapting the higher rate to market fluctuations
National Bank of Denmark heads deeper into negative territory
Unscheduled cut pushes deposit rate further below zero and leaves lending rate barely in the positive as krone comes under pressure ahead of expected ECB action
SNB shocks markets by abandoning euro ceiling ahead of ECB showdown
Swiss franc sharply appreciates against the euro in the wake of the Swiss National Bank’s decision to scrap the minimum exchange rate; central bank does not rule out ad hoc interventions
Central Bank of Azerbaijan hits back at FX critics
Forex interventions made in 2014 – buying foreign currency throughout the year and then reversing the trades in a single month – were essential for maintaining stability, central bank says
Central bank expects Serbian FX market to stabilise
National Bank of Serbia reveals it sold €1.8 billion and bought €260 million at various points last year in an attempt to ‘ease short-term volatility’ in exchange rate
SNB expects profit of $39 billion for 2014
Foreign currency positions responsible for most of the profit for Swiss National Bank, which increased its forex reserves by 7% in December following exchange rate pressure
Central Bank of Venezuela grants exchange rate boost to state oil company
Venezuela's state-owned oil company can now sell its dollars from certain export contracts at the highest exchange rate in the country; president hints at exchange rate reform
State Bank of Vietnam devalues dong as dollar rises
Vietnam’s central bank devalues the dong by 1% against the dollar, in a move to create ‘sustainable stability’ in the forex market
HKMA finds signs of forex manipulation at banks
Investigation into forex market manipulation turns up two cases of misconduct but finds no collusion between banks; six banks criticised for communication ‘indiscretions’
Bank of South Sudan keen for exchange rate reform
IMF report finds authorities keen to create a single exchange rate, launch two-way fixed rate auctions and establish an interbank market for foreign exchange
Russian central bank 'prepares' to recapitalise banks
Central bank announces package of measures to safeguard credit institutions from currency crisis fallout; finance ministry reportedly sells own foreign exchange
External imbalances predict exchange rate returns, finds SNB paper
Deviations from trends in Swiss net foreign assets and net exports indicated how nominal exchange rate will move in the future, according to a Swiss National Bank working paper
Active FX intervention could have long-term costs, says Bank of Mexico deputy
Central bank policies to manage capital flows ‘may have resulted in short-term benefits’ but their costs in terms of market distortions ‘may be high’
SNB working paper examines drivers of Swiss franc real exchange rate
Research finds terms of trade and relative government are ‘the most significant explanatory variables’, while Balassa-Samuelson effects are unimportant