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Interest Rate Monitor March 31 st 2009. 2 Internationally.

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Presentation on theme: "Interest Rate Monitor March 31 st 2009. 2 Internationally."— Presentation transcript:

1 Interest Rate Monitor March 31 st 2009

2 2 Internationally

3 3 Recap of the Week: Wall Street: A Critical Crossroad

4 4 Recap of the Week: Economy: Worst in 26 years The US government confirmed Thursday that the U.S. economy suffered its largest drop in 26 years during the fourth quarter. The nation's gross domestic product, the broadest measure of economic activity, fell at an annual rate of 6.3% during the final three months of That's slightly worse than the government's previous estimate of a 6.2% drop in the period. Economists surveyed by Briefing. COM had forecast that GDP would fall at a 6.6% rate in the latest reading. The drop is the biggest one-quarter decline in this key measure since the first three months of 1982.

5 5 Recap of the Week: Other Markets Crude Oil: Oil fell nearly $2 Friday as weaker stock markets, soft economic data and evidence of OPEC overproduction encouraged profit-taking after several days of gains. U.S. crude traded down $1.96 to settle at $52.38 a barrel, pulling back from Thursday's four-month high. London Brent crude fell $1.48 to $ The pullback came as U.S. and European stock markets dipped on continued concern over the global economy. Treasuries: Treasury prices fell, raising the yield on the benchmark 10-year note to 2.76% from 2.73% Thursday. Treasury prices and yields move in opposite directions. Lending rates declined. The 3-month Libor rate fell to 1.22% from 1.23% Thursday, according to Bloomberg.com. The overnight Libor rate fell to 0.28% from 0.29%. Libor is a bank-to-bank lending rate.

6 6 Next Week: Economic Calendar 30 March-3 April 09 Prev.Cons.EventCCYGMTDate Euro-Zone Economic Confidence (MAR)EUR09:0030/3/ Euro-Zone Business Climate Indicator (MAR)EUR09:0030/3/ %--Dallas Fed Manufacturing Activity (MAR)USD14:3030/3/09 1.2%0.9%Euro-Zone CPI Estimate (YoY) (MAR)EUR09:0031/3/ S&P/Case-Shiller Home Price Index (JAN)USD13:0031/3/ Chicago Purchasing Manager (MAR)USD13:4531/3/ Consumer Confidence (MAR)USD14:0031/3/09 9.1M9.3MTotal Vehicle Sales (MAR)USD--1/4/09 34 Euro-Zone Purchasing Manager Index Manufacturing (MAR F) EUR08:001/4/09 8.2%8.3%Euro-Zone Unemployment Rate (FEB)EUR09:001/4/ K-650KADP Employment Change (MAR)USD12:151/4/ ISM Manufacturing (MAR)USD14:001/4/ ISM Prices Paid (MAR)USD14:001/4/09

7 7 Economic Calendar (continued) Prev.Cons.EventCCYGMTDate -7.7%-2.0%Pending Home Sales (MoM) (FEB)USD14:001/4/ %-1.7%Construction Spending (MoM) (FEB)USD14:001/4/09 -- Group of 20 (G 20) Summit In LondonALL--2/4/ %1.00%European Central Bank Rate DecisionEUR11:452/4/09 652K--Initial Jobless Claims (MAR 28)USD12:302/4/ %-1.2%Factory Orders (FEB)USD14:002/4/ Euro-Zone Purchasing Manager Index Composite (MAR F) EUR08:003/4/ K-660KChange in Non-farm Payrolls (MAR)USD12:303/4/09 8.1%8.5%Unemployment Rate (MAR)USD12:303/4/ ISM Non-Manufacturing Composite (MAR)USD14:003/4/09 -- Bernanke Speaks at Fed Credit-Markets Conference in Charlotte USD16:003/4/09

8 8 Fed Fund 30 Day Product Rates 30/3Rates 22/3Product %0.1975% FFH9 Mar %0.22% FFJ9 Apr %0.25% FFK9 May %0.235% FFM9 June %0.255% FFN9 July 09

9 9 US Treasury Yield Curve Yield 30/3/09 Yield 23/3/09 Yield 10/3/09 Tenure M M M Y Y Y Y

10 10 LIBOR Rates.. Tenure USD 10/3/2009 USD 23/3/2009 USD 30/3/2009 O/N wk mth mth mth mth

11 11 Locally

12 12 Local News: the value of national exports rise by 16.9 % The statistical data issued by the Department of Statistics indicate a rise in the value of national exports by 16.9 % and the re-exports by 3.5 % during January 2009 compared with the same period of In contrast, the value of imports has decreased by 15 % during January The deficit in the trade balance, which is calculated by deducting the value of imports from the value of total exports, has risen by 33.2 % during January 2009 as compared to the same period of 2008, therefore the imports coverage by the exports stood at 52.2 %, meanwhile the imports coverage by the exports was 39.1 % for the same month of the previous year which means an increase by 13.1%.

13 13 Local News: Credit facilities declined by 1.9 % Credit facilities extended by licensed banks in Jordan declined by 1.9 % to JD12.9 billion at the end of February 2009 from JD13.2 billion at the end of According to Central Bank of Jordan (CBJ) figures, credit facilities to individuals dropped by JD307.9 million to JD3.9 billion compared with JD4.2 billion in The drop in retail credit facilities accounted for 120 % of the total decline in credit facilities, the CBJ report indicated. Another sector affected by the fall in credit facilities was general trade which regressed by JD19 million from JD2.91 billion in 2008 to JD2.89 billion until the end of February of this year. However, facilities to the construction and industry sectors increased by JD71.8 million and JD26.6 million to JD2.34 billion and JD1.62 billion respectively compared with JD2.27 billion and JD1.59 billion in 2008

14 14 Interest Rate Watch Excess Liquidity & Government Issues As of March , the volume of excess reserves, including the overnight window deposits held at the CBJ JD( 2,495.4 ) million. Unified Coupon Size of the Issue Maturity Date Issue DateLatest 3 yr TBond 6.747%JD 50 mio15/1/201215/1/2009T %JD 50 mio22/1/201222/1/2009T %JD 50 mio29/1/201229/1/2009T %JD 100 mio26/3/201226/3/2009T509

15 15 Interest Rate Watch Corporate CDs 15M12M6M3M 7.00%N.A6.625%6.375% JOD N.A. N.A1.25%. USD Union Bank Capital Bank 12M6M3M 3.5%2.75%2.25%USD

16 16 Prime Lending Rates.. BankRateBankRate ARBK8.50%THBK8.50% AJIB7.75%HSBC8.50% BOJK8.75%JIFB8.50% JOCB8.75% JOKB8.80% CABK8.75%JONB8.50% EFBK8.50%Arab Land8.50% Audi8.50%Union Bank9.00% NBK8.50%BLOM8.75%

17 17 Prime Lending Rates..

18 18 Chart of the Week

19 19 The Thin Line Between Inflation & Deflation Accumulated inflation in Jordan witnessed growth of 4.5% in the first two months of 2009, compared with the same period of However, comparing the results on a monthly basis, we can notice the steep downward trend of the CPI between January 2009 and Dec The Healthy Rate of Inflation in Jordan is 2- 6%.

20 20 Disclaimer THIS REPORT DOES NOT CONSTITUTE ANY RECOMMENDATION TO BUY, SELL OR HOLD ANY SECURITY. CAIRO AMMAN BANK HAS PREPARED THIS REPORT FROM SOURCES THOUGHT TO BE RELIABLE, THEREFORE; CAIRO AMMAN BANK DOES NOT HOLD ANY RESPONSIBILITY TO THE INFORMATION ENCLOSED HEREIN NOR TO THE DECISIONS BASED UPON.


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