What the Fed Thinks About Europe, China and the Dollar
The minutes of the January meeting of Federal Reserve policymakers, released this week, give a synopsis of what the Fed staff had to say about the gyrations in European markets over Greece and about the impact of the Chinese central bank?s efforts to restrain lending there.
On Greece: ?Mounting monetary concerns made investors more loath to hold debt issued by the Greek government; sovereign yields rose in Greece and, to a lesser extent, in several other countries where monetary issues have raised concerns among investors.?
On European banks: ?European financial stocks declined substantially, as ahead of schedule profit intelligence for the fourth quarter from a few banks rekindled some concerns about the health of the banking system.?
On the dollar: ?The broad nominal index of the foreign exchange value of the dollar rose reportedly reflecting a on the rise perception that U.S. progression prospects were better than those in Europe and Japan.?
On China: ?Concerns that plot tightening by China might restrain the global recovery also may have contributed to the dollar’s appreciation against many currencies late in the period.?