Arrangement of various world currencies including Chinese Yuan, Japanese Yen, US Dollar, Euro, British Pound, Swiss Franc pictured in Warsaw

The Reserve and Central Banks that matter and the ones that don’t

For us traders having an edge is everything. We can get it from history, technical analysis, ability to read between the lines and on opportune occasions from a friend of a friend who works for a government statistics or financial institutions.

History is there to be changed and technical analysis only works in a world of no news or current events. That friend of a friend action is simply illegal so we are left with reading between the lines.

Some central and reserve bankers stay true to their word and action their convictions and others simply make statements based on hopes and dreams.

Here is a list of central bankers you should believe and listen to and those working down towards those that bark but never bite.

 

Top 4 to listen to:

1: EUROPEAN CENTRAL BANK (ECB)

Negative Interest Rates do we need to say more. The ECB puts its money where its mouth is.

2: The Federal Reserve Bank (FEDS)

The American are known for following financial guidance they set and manipulating fiscal policy to get there.

3: BANK OF JAPAN (BoJ)

Abenomics is the epitome of modern day trade boosting. With massive quantitive easing efforts the BoJ devalued the Yen beyond anyones imagination. These guys get the job done.

4: BANK OF ENGLAND (BoE)

The BoE does not sway from its fiscal outlines and although they board votes interestingly the guidance is rarely neglected.

 

Top 4 to Ignore:

1: Any central bank of any European country that uses the Euro

The ECB outlook will always overrun any national agenda.

2: Reserve Bank of Australia (RBA)

The RBA has great thoughts but let’s face it – this dog does not bite. Glenn Stevens mentioned at the beginning of the year that he hoped for AUDUSD to hit the mid .80s range but failed to delivery any directional policy.

3: The guy who directs Finance in China

The Chinese policy and practices are as transparent as a block of steel. Just ignore it. the rest of the world has.

4: The Swiss National Bank

This bank has no directive bone in its policy so they invented an exchange guarantee. This exchange guarantee sits at 1.20 EURCHF. This is to ensure right of passage and trade with the rest of Europe as the bank admits effectively it cannot control its currency. No Exchange Guarantee since 2015

 

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