I happen to spend my summers in Norway. I was quite amazed at the amount of negative response received from European posters on the ECB post. I still believe the ECB is making a mistake. Granted, the ECB is dealing with a host of issues the FED does not have, such as, semi-rigid labor markets. I still believe the ECB’s target and potential slavish adherence with keeping to an inflation target will cause a lot of unnecessary pain to the Euro zone. Yes, I am in the “this inflation is transitory” camp.

However, the last few days have seen an orchestrated move in several central bank policies. Most notably, the ECB is telegraphing the potential to raise its rates. The Bank of Canada did not cut rates. India has raised rates. China is making moves to drain liquidity from its system. The US has aggressively moved to jawbone the dollar. I have a tendency to watch the US/NOK relationship, since it is the one that is currently causing the most current and dramatic pain to my pocket book. What has been interesting to note is the ability for the US dollar to continue to pick itself off the 1 Dollar/5 NOK floor. This is occurring even as oil races back up to new highs. I am thinking (praying) that the dollar may have found its floor. Could this be a soft signal that oil is now starting to reach the peak of its bubble?

Last 5 posts by Keith Lenger

• Back in action - May 17th, 2009
• What the Hell is happening? - June 22nd, 2008
• Banks - June 12th, 2008
• Blow -Off Top: OIL - June 10th, 2008
• Does Trichet have it out for the US? - June 6th, 2008