11 Feb 2015
Another rate cut in Denmark likely – BBH
FXStreet (Barcelona) - The Brown Brothers Harriman Team notes that with its rates already in the negative territory Denmark is likely to face another 25bp rate cut.
Key Quotes
“There is much speculation that Denmark will soon capitulate to the same forces that saw the Swiss National Bank abandon the franc cap last month. However, Denmark continues to resist. It has not reached the end of its rope.”
“The SNB's Jordan warned recently that Swiss rates have not bottomed. The same can be said of Denmark.”
“Its key rate, the two-week CD rate is set at -75 bp, the same as the SNB's LIBOR target.”
“Another 25 bp rate cut in the coming weeks seems likely, and even that may not be the bottom.”
“The fact of the matter is that negative interest rates are unprecedented, and it is far from clear what the limit is at this juncture.”
Key Quotes
“There is much speculation that Denmark will soon capitulate to the same forces that saw the Swiss National Bank abandon the franc cap last month. However, Denmark continues to resist. It has not reached the end of its rope.”
“The SNB's Jordan warned recently that Swiss rates have not bottomed. The same can be said of Denmark.”
“Its key rate, the two-week CD rate is set at -75 bp, the same as the SNB's LIBOR target.”
“Another 25 bp rate cut in the coming weeks seems likely, and even that may not be the bottom.”
“The fact of the matter is that negative interest rates are unprecedented, and it is far from clear what the limit is at this juncture.”