Hungary Central Bank Leaves Rates Unchanged

Trading 22 oct 2019 Commentaire »

Hungary's central bank kept its benchmark interest rates unchanged, as expected, on Tuesday, citing asymmetric risks to inflation.

The Monetary Council of the Magyar Nemzeti Bank decided to hold the base rate unchanged at 0.90 percent.

The previous change in the rate was a 15 basis points reduction in May 2016. The overnight central bank deposit rate was held at -0.05 percent. In March, it was cut by 10 basis points. The one-week collateralized loan rate was retained at 0.90 percent. Inflation remains volatile and economic growth is expected to slow in the coming months, the bank said. Downside inflation risks have strengthened further, the bank added.

Hungary's GDP growth was forecast at 4.5 percent for this year and by 3.3 percent in 2020 and 2021.

"The monetary policy stance will continue to be accommodative, economic agents' financing costs will be favorable," the bank said.

The bank pointed to a "dichotomy" between the factors determining likely developments in inflation.

"Buoyant domestic demand is boosting, while weakening external activity is increasingly restraining the pace of inflation," the MNB said.


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U.S. Existing Home Sales Pull Back Much More Than Expected In September

Trading 22 oct 2019 Commentaire »

After reporting an unexpected jump in existing home sales in the previous month, the National Association of Realtors released a report on Tuesday showing existing home sales pulled back by much more than anticipated in the month of September.

NAR said existing home sales plunged by 2.2 percent to an annual rate of 5.38 million in September after jumping by 1.5 percent to an upwardly revised 5.50 million in August.

Economists had expected existing home sales to drop by 0.7 percent to a rate of 5.45 million from the 5.49 million originally reported for the previous month.

Despite the monthly pullback, the report said existing home sales in September were up by 3.9 percent compared to the same month a year ago.

NAR chief economist Lawrence Yun suggested a low level of new housing options has prevented home sales from increasing commensurately with historically low mortgage rates.

"We must continue to beat the drum for more inventory," Yun said. "Home prices are rising too rapidly because of the housing shortage, and this lack of inventory is preventing home sales growth potential."

The report said the median existing-home price for all housing types was $272,100 in September, down 2.4 percent from $278,000 in August but up 5.9 percent from $256,900 a year ago.

Total housing inventory at the end of September represented 4.1 months of supply at the current sales pace, up from 4.0 months in August but down from 4.4 months in September of 2018.

NAR said single-family home sales tumbled by 2.6 percent to a rate of 4.78 million in September, more than offsetting a 1.7 percent jump in existing condominium and co-op sales to a rate of 600,000.

On Thursday, the Commerce Department is scheduled to release a separate report on new home sales in the month of September.

New home sales are expected to slump by 1.7 percent to an annual rate of 701,000 in September after spiking by 7.1 percent to a rate of 713,000 in August.


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Dollar Little Changed After U.S. Existing Home Sales

Trading 22 oct 2019 Commentaire »

Following the release of U.S. existing home sales for September at 10:00 am ET Tuesday, the greenback changed little against its major counterparts.

The greenback was trading at 108.50 against the yen, 1.1134 against the euro, 1.2926 against the pound and 0.9882 against the franc around 10:02 am ET.


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*U.S. Existing Home Sales Plunge 2.2% In September

Trading 22 oct 2019 Commentaire »

U.S. Existing Home Sales Plunge 2.2% In September


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Eurozone Banks Unexpectedly Eased Credit Standards For Businesses In Q3 – ECB

Trading 22 oct 2019 Commentaire »

Euro area banks slightly eased the credit standards for loans to enterprises and those to households for house purchase in the third quarter, data from the third quarter euro area bank lending survey from the European Central Bank showed on Tuesday.

Banks had expected them to remain broadly unchanged in the previous survey.

The slight easing in credit standards on loans to enterprises was largely driven by the impact of competition, mainly from other banks, except in Germany.

Meanwhile, risk perceptions, related to a deterioration in the general economic and firm-specific situation, continued to exert pressure in the opposite direction, the ECB said.

Among the big area countries, credit standards for lending to businesses eased in Italy and the Netherlands, while slightly tightened in France and Germany. Credit conditions were unchanged in spain.

Looking ahead, banks expect no change in credit standards for loans to businesses in the fourth quarter.

Demand for loans to businesses were largely unchanged in the third quarter, while that was expected to increase in the previous survey. Banks expect loan demand to remain broadly unchanged in the fourth quarter.

For housing loans, competitive pressure and lower risk perceptions were the main drivers behind the latest easing in credit standards, the survey said. Credit standards are expected to remain unchanged in the final three months of the year.

Lower interest rates and favorable market prospects substantially boosted the demand for housing loans in the third quarter. The increase was above the historical average and higher than banks expected in the previous survey.

Euro area banks expect a continued increase in net demand for housing loans in the fourth quarter.

Credit standards for consumer credit and other lending to households continued to tighten in the third quarter, defying expectations for a net easing. These are expected to remain largely unchanged in the fourth quarter.

Demand for consumer credit and other lending increased in the third quarter and are expected to continue to increase in the final three months of the year.


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Canadian Dollar Declines After Weak Retail Sales Data

Trading 22 oct 2019 Commentaire »

The Canadian dollar moved down against its major opponents in the European session on Tuesday, as a data showed that the nation's retail sales contracted unexpectedly in August.

Data from Statistics Canada showed that retail sales fell 0.1 percent in August, after rising 0.6 percent in the previous month. Economists had forecast a 0.5 percent increase.

Core retail dropped 0.2 percent on month, following a flat reading in July. The rate was forecast to rise 0.1 percent.

Investors digested election results in Canada. The Liberals, led by Prime Minister Justin Trudeau have won a closely fought battle for supremacy, but then it will be a minority government that will need the support of a smaller left-leaning party in Parliament.

The currency traded mixed against its major counterparts in the Asian session. While it rose against the greenback and the yen, it was steady against the euro and the aussie.

The loonie depreciated to 1.3123 against the greenback, from a 3-month high of 1.3071 it touched at 9:15 pm ET. Continuation of the loonie's downtrend is likely to see it challenging support around the 1.33 level.

Following a 6-day advance to 1.4569 against the euro at 5:45 am ET, the loonie changed direction and fell to 1.4601. Should the currency drops further, it may challenge support around the 1.47 level.

Having climbed to more than a 3-month high of 83.17 against the yen at 9:15 pm ET, the loonie pulled back to 82.80. Next likely support for the currency is seen around the 79.5 level.

The loonie retreated to 0.8995 against the aussie, from a 2-day high of 0.8973 it recorded at 5:30 am ET. The currency is poised to find support around the 0.92 level.

Looking ahead, U.S. existing home sales for September are due at 10:00 am ET.


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*Canadian Dollar Edges Down To 1.4601 Against Euro

Trading 22 oct 2019 Commentaire »

Canadian Dollar Edges Down To 1.4601 Against Euro


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*Canadian Dollar Declines To 82.80 Against Yen

Trading 22 oct 2019 Commentaire »

Canadian Dollar Declines To 82.80 Against Yen


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*Canadian Dollar Weakens To 1.3115 Against U.S. Dollar After Retail Sales

Trading 22 oct 2019 Commentaire »

Canadian Dollar Weakens To 1.3115 Against U.S. Dollar After Retail Sales


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Hong Kong Announces Additional Stimulus Measures

Trading 22 oct 2019 Commentaire »

Hong Kong Financial Secretary Paul Chan on Tuesday announced a new round of measures to support the economy hit by domestic anti-government protests.

Chan's new package worth HK$2 billion is intended to support enterprises and safeguard jobs, particularly in hard-hit sectors. This was in addition to the HK$19.1 billion stimulus unveiled in August and early September.

"In the face of the economic downturn, both enterprises and residents alike are in need of support," Chan said.

"Although the launch of the various rounds of supporting measures may cause fiscal deficit, with sound financial strength the Government will utilize our financial reserves to implement timely and suitable counter-cyclical measures, so as to stimulate the economy and relieve people's hardship, and go through the wave of economic downturn with the community together," Chan added.

Measures announced by Chan include a one-off survey fee subsidy for local commercial marine vessels costing HK$16.5 million to support around 6,300 vessels.

He also unveiled a 50 percent reduction in rental fees for public car parks, catering establishments and retail stores in government land.

Further, the government also introduced a six-month fuel subsidy or a one-off subsidy to assist the transport trades. This will cost about HK$1.365 billion and benefit around 61,000 taxi/red minibus drivers, 180 public transport operators, and owners of 130,000 commercial vehicles and vessels, Chan said.


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