Today, the finger-pointing in Europe continued as Bank of France Governor Christian Noyer scolded the ratings agencies and complained that it was the U.K. that should lose its AAA credit rating before France. Let us be clear: Christian Noyer is way out of line. First, the French are the premier bashers of the over aggressive role that Moody’s, S&P and Fitch play on the international financial scene. But when the power of the agencies can be used against a foe, then NOYER can point the finger that the BRITS are much weaker than the French and need to be punished. Secondly, NOYER shows how inept he is as a central banker because the finger-pointing does nothing to make the case of why France should not suffer a downgrade.
Posts Tagged ‘Christian Noyer’
The August 9 FOMC minutes from were released today and there was a great deal of discussion about the issue of leaving rates at the present level for the next two years. It seems that one of the dissenters opposed the measure for he didn’t want the FED to be locked in to a decision and thought the measure should be subject to newly released data. There was much discussion about European banks and the efforts by the ECB to calm the storm and prevent a bank run. The FED did acknowledge that the biggest drag on U.S. growth was the “efforts to rebuild balance sheets and caution on the part of households facing an uncertain economic environment.”
As we all know, the FED held rates at the FOMC meeting and left the “extended period” phrase in and will maintain QE2 through its duration. Two weeks ago Jon Hilsenrath opined that the FED would likely remove the “extended period” language but that proved another opinion without material support. Many analysts felt that the March 15 FOMC statement was more hawkish than previous statements but I struggle to see how that is in fact the case. Yes, the FED did say the economy is on “firmer footing and overall conditions in the labor market appear to be improving gradually.” There were a few references to inflation but that hardly makes for a hawkish outlook.