Europe - ECB & BOE 01 (May 08 - Nov 11)

[AirFlownAussiePork]

ECB trade off monetary policy control for the sake of having a union. They had not been challenged for quite sometime prior to the sub prime crisis. But it looked totally fangless when trying to contain the aftermath of the crisis.

[kennynah]

hahahaha....the pound has lost its glory along with the crumbling of the british empire... it used to have to kowtow to only the USD...but now, it is secondary to the euros...

[AirFlownAussiePork]

It used to be S$8 to a pound if my old memories don't fail me. The Sun did set on the British Empire.......

hahahaha....the pound has lost its glory along with the crumbling of the british empire... it used to have to kowtow to only the USD...but now, it is secondary to the euros...

[winston]

Bank of England pumps billions more into economy

LONDON (AFP) - – The Bank of England revealed plans Thursday to pump another 25 billion pounds (28 billion euros, 41 billion dollars) to boost the recession-hit British economy, and held interest rates at a record low.

The central bank's policymakers decided to lift its quantitative easing (QE) programme to a total of 200 billion pounds, amid concern that Britain is mired in its longest recession since records began in 1955.

http://sg.news.yahoo.com/afp/20091105/t ... c1e9b.html

[kennynah]

ECB holds rates unchanged....

[winston]

Trichet Clears Obstacles to Higher Rates in Stimulus Withdrawal
By John Fraher and Frances Robinson

Dec. 4 (Bloomberg) -- European Central Bank President Jean- Claude Trichet is withdrawing stimulus measures faster than economists anticipated, clearing obstacles to higher interest rates next year.

The ECB’s decision yesterday to end long-term emergency loans and tighten the terms of its final 12-month tender will give greater traction to any rate increases in 2010 should policy makers deem them necessary.

“The ECB chose a quicker exit path,” said Laurent Bilke, a former ECB economist now at Nomura International Plc in London. “It’s very difficult not to think it’s the beginning of a tightening process.”

Yesterday’s announcements “put the ECB in a position where it can choose to raise rates if it wants to further down the line,” said David Page, an economist at Investec Securities in London. “We’re penciling in a rate rise in the second half of next year.”
“Once liquidity conditions normalize in the third quarter of next year, the Eonia rate is likely to move back to the refinancing rate,” said Nick Kounis, chief European economist at Fortis Bank Nederland NV in Amsterdam.

“This would pave the way for conventional monetary tightening from the autumn of next year, and we expect 50 basis points of rate hikes by the end of 2010.”

http://www.bloomberg.com/apps/news?pid= ... BfRHhIWU5E

[kennynah]

ECB maintains present interest rate @ 1%

[winston]

Things will not be so hot in the Eurozone for a while.

They will try to maintain low interest rates unless the Euro drops steeply.

[millionairemind]

Things will not be so hot in the Eurozone for a while.

They will try to maintain low interest rates unless the Euro drops steeply.

Euro drops compared to USD? Yen??

Everybody's trying to debase their currency and export themselves back to health again

[millionairemind]

British Central Banker Favors Splitting Big Banks

LONDON — Mervyn A. King, the governor of the Bank of England, is an owlish, self-effacing man who, in contrast to his more outspoken peers in Frankfurt and Washington, strikes a public posture that borders on the demure.

But as outrage over lush banking profits gathers steam on both sides of the Atlantic, Mr. King finds himself at the vanguard of a growing movement that argues that big banks must separate their higher-risk trading and investment banking businesses from their core deposit-taking functions.

Last week, such a proposal pushed by the former Federal Reserve chairman Paul A. Volcker made headway. President Obama shocked Wall Street by proposing that large banks that collect customer deposits be banned from engaging in proprietary trading activities.
http://www.nytimes.com/2010/01/27/busin ... ref=global