Norges Bank

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Did Mario Draghi Just Leak The Bazooka? Two-Tiered NIRP System May Presage Big Rate Cut





With the ECB's December meeting just one week away, Mario Draghi and co. are still debating how best to package a new round of easing measures. As Reuters reports, the central bank is considering a tiered system for the application of negative rates in an effort to mitigate the effect on banks. Translation: the ECB may be preparing to "overwhelm" with an even larger cut to the already negative depo rate that analysts were expecting.

 
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Swiss Bank "Goes There", Applies Negative Rates To Retail Deposits





"We have determined that applying a negative rate was a more transparent and fairer solution for our clientele. This decision on negative rates is costing us a lot of money -- pretty much the equivalent of our entire annual profit last year."

 
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Rich Nation Problems: Even If Norway Wanted To Do QE, They Couldn't





"My guess is that we will have negative rates in Norway before there will be any talk of QE"...

 
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World's Largest Sovereign Wealth Fund Has Worst Quarter In 4 Years After Losing 21% On Chinese Stocks





Norway's $860 billion sovereign wealth fund (tasked with managing the country's vast oil wealth) just had its worst quarter in 4 years and its first back-to-back quarterly loss since 2009 after an array of EM bets went awry. Meanwhile, the government is set to start making withdraws from the fund as slumping crude prices have effectively reduced inflows to zero. 

 
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Slumping Crude Will Send Norway To ZIRP As Economy Careens Toward Recession





With crude prices still stuck in the doldrums, economists at Handelsbanken say the Norges Bank will soon be forced to cut rates to zero in order to stave off a looming recession. What we want to know is this: if the housing bubble that the Norges Bank has helped to inflate bursts, how does the central bank plan to deal with the fallout (which will be amplified by the economic drag from low oil prices) when it has exhausted its counter-cyclical capacity by cutting rates to zero?  

 
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Futures Surge On Renewed "Hopes" Of Fed Rate Hike, Sliding Yen





The market, which clearly ignored the glaring contradictions in Yellen's speech which said that overseas events should not affect the Fed's policy path just a week after the Fed statement admitted it is "monitoring developments abroad", and also ignored Yellen explicit hint that NIRP is coming (only the size is unclear), and focused on the one thing it wanted to hear: a call to buy the all-critical USDJPY carry pair - because more dollar strength apparently is what the revenue and earnings recessioning S&P500 needs - which after trading around 120 in the past few days, had a 100 pip breakout overnight, hitting 121 just around 5am, in the process pushing US equity futures some 25 points higher at last check.

 
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Global Easing Bonanza Continues As Norway, Taiwan Cut Rates To Spur Struggling Economies





The global race to the bottom continued on Thursday as Norway and Taiwan moved to cut rates sending NOK plunging to its weakest level against the dollar in 13 years and pressing Tawain dollar forwards to six year lows. 

 
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Stocks Tumble As Emissions Scandal Spreads To BMW; NOK Plunges On Unexpected Norway Rate Cut





European equity have been weighed on by BMW after reports in German press that the Co.'s emission tests for their X3 model could show worse results than that of the Volkswagen Passat. The Norwegian and Taiwanese central banks have both cut interest rates, taking the number of central banks to cut rates this year to 40. Today's highlights include US weekly jobs data and durable goods orders as well as comments from ECB's Praet and Fed's Yellen. Of note US data, including jobless claims, durables and home sales will be delayed today & not released to newswires 1st due to Pope's visit

 
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"Calm Reigns" Everywhere As Greece Inches Closer To Default, China Crashes





European shares remain higher, close to intraday highs, with the autos and travel & leisure sectors outperforming and basic resources, utilities underperforming. Meeting of finance officials to reach a deal over Greek aid ended in frustration, forcing leaders to call for an emergency summit for Monday. ECB plans to hold an emergency session of its Governing Council on Friday to discuss a deterioration in liquidity at Greek banks, three people familiar said. German airwave auction raises $5.7b to top 2010 sale. Bank of Japan leaves monetary policy unchanged as forecast. Shanghai Composite Index capped its worst weekly decline in seven years.

 
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