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Euro dips below $1.25

11/11/08

FRANKFURT, Germany (AP) — The euro drifted below $1.25 on Wednesday, dragged down by worldwide economic gloom and falling equity markets, before staging a slight recovery.

The 15-nation currency dropped to $1.2481, a level last seen in October 2006, before recovering to $1.2578 in European morning trading. That compared with its level of $1.2531 in New York late Tuesday.

The British pound slipped to $1.5392 from $1.5401, while the dollar edged up to 97.80 Japanese yen from 97.68 yen.

"Falling equity markets and global economic gloom mean traders are continuing to favor the greenback as a currency of choice," said analyst James Hughes of CMC Markets in London.

He said the pound could face pressure from economic reports due later Wednesday: the Bank of England's quarterly inflation report and new unemployment figures. Both could have a bearing on the bank's interest rate course.

"Clearly, monetary policy remains in focus so anything that points toward yet more cuts at the start of next month will have the potential to heap yet more pressure on the pound" and send it lower, he said.

Last week the Bank of England lowered its interest rate to 3 percent, a 50-year low. The European Central Bank cut its rate to 3.25 percent.

Lower interest rates can help prompt economic activity, but also typically drive investors away from a currency as they seek higher returns elsewhere.

Courtesy: pounds-euros-dollars | associatedpress | guardianuk

Euro poll question revealed

Gordon Brown

Mr Brown will examine euro case next year

The referendum question the UK may use if a vote is held on joining the euro has been published by the government.

The question, revealed in the government's draft euro referendum bill, is: "Should the United Kingdom adopt the euro as its currency?"

Gordon Brown announced the paving bill in his pre-Budget report speech to MPs.

Downing Street on Thursday played down suggestions that the bill meant Tony Blair wanted a referendum on the same day as a general election.

Vote coincidence?

The chancellor announced in June that the UK had yet to meet his five economic tests for joining the single currency.

The government says the new bill gives "maximum flexibility" over holding a referendum if the tests are passed.

Ian Davidson, chairman of Labour Against the Euro, said the bill included a clause specifically stating that a euro vote could be combined with an election.

The MP warned: "Plans to hold a euro referendum on the same day as a general election are another sign of desperation by the euro enthusiasts.

"In their zeal to bounce Britain into the euro, they are willing to place at risk Labour seats and votes.

"A Labour Party seeking re-election would be deeply divided in a referendum, while the Tories would be handed the bonus of a campaign in tune with the majority of British voters."

'Ruled out'

But Downing Street said the government's stance had not budged since Mr Blair was questioned about the idea in May.

He had told reporters: "I have never had the idea of holding a referendum on the same day as the general election."

A Number 10 spokesman said: "The position has not changed. It is pretty categorical in terms of ruling it out."

The timing of the draft bill's publication has prompted Conservatives to accuse ministers of trying use the diversion of the pre-Budget report on Wednesday to hide the "controversial" wording of the referendum.

Tory constitutional affairs spokesman Alan Duncan said: "The government are back to their old tricks of trying to 'bury bad news'.

"The proposed referendum question breaches Electoral Commission guidelines on fair wording. It makes no mention that the pound would be replaced if people vote 'yes'.

"A fair question would make clear the implications for our existing national currency.

"The government are using sleight of hand to hide a euro referendum fix."

'Guidelines followed'

Mr Brown has said he will reveal in his Budget next year whether he thinks there is a case for another assessment of possible UK-membership of the euro according to his five economic tests.

In his statement on the single currency to MPs in June, Mr Brown said four of the five tests had yet to be met - the one relating to financial services being the only one to get the chancellor's approval.

But he said progress on passing two of the tests - on economic flexibility and convergence with the eurozone - would lead to the remaining two tests being satisfied.

The Department for Constitutional Affairs said the question had been drafted using Electoral Commission guidelines.

The Commission - which has a statutory obligation to assess the question - will formally review it when the bill is introduced into Parliament.

That would only happen if the Treasury decided its convergence criteria had been met and the economic conditions were right for Britain to lose to the pound.

Cabinet and then Parliament would then have to approve the decision before it went out to the British people.

********************

Economic rout seems to take on a life of its own
By Jeremy Gaunt
Published: October 26, 2008

LONDON: The big question facing investors across the world this week is, "How long will this go on."

The U.S. Federal Reserve Board is widely expected to cut interest rates sharply, corporate earnings reports will flow in and many investors will be looking at the preparations for a global financial summit meeting next month, and even the U.S. presidential election.

But the sell-off/panic/rout - call it what you will - on stock markets and foreign exchange last week and in the months preceding has become so severe that it is almost gaining a life of its own outside of events.

"There's nothing we can do; investors may just have to suffer," Koichi Ogawa, chief portfolio manager at Daiwa SB Investments, said Friday as his local stock index, the Japanese Nikkei 225 share average, tumbled nearly 10 percent in one day. "Nobody wants to catch a falling knife."

The MSCI all-country world stock index hit a five-year low Friday. In reaching that level it has wiped out in less than a year about 80 percent of the approximately $20 trillion in value gained in the prolonged recovery since the Internet-stock debacle.

The latest wrinkle, however, is that an emerging-market decline is gathering pace. The MSCI emerging market index lost about 15 percent last week for a month-to-date decline of 39 percent.

At the same time, emerging market sovereign debt was clobbered and various developing economy currencies sank. Hungary was even required to raise interest rates by 3 full percentage points to protect its falling currency, the forint.

It is not at all clear that this week will prove much different.

The abandonment of emerging markets has not been brought on just by lack of confidence in riskier assets as the global recession takes hold. The repatriation of money is also a reflection of hedge funds and others deleveraging, that is, liquidating their holdings to get back borrowed money.

Such funds are essentially selling into any strength they see, meaning that any attempts at a rally are short-lived. It is also unclear how much needs to be liquidated.

A Société Générale strategist, Albert Edwards, suggested that the deleveraging trend could run at least for the rest of this year and that it would start adding to a deteriorating picture for emerging markets.

"As reserves fall in EM economies, liquidity is squeezed and they get hurt by this on top of the export slowdown," he said, adding that there were "bigger downside surprises to come in EM growth disappointment."

Not that emerging markets are alone. The world's richest economies are where the rot set in, and there is little likelihood of immediate improvement there, either.

The Swiss-based wealth manager Sarasin is warning clients to expect U.S. data this week to show falling sales for new home and home prices, a gloomy outlook for U.S. production, weaker durable goods and battered consumer confidence.

Into this will step the Fed, with investors expecting a lot from its meetings Tuesday and Wednesday. Interest rate futures show a majority of market players leaning toward a cut of 100 basis points rather than 75 basis points. This would follow an emergency cut of 50 basis points earlier this month and leave federal fund rates as low as a wafer-thin 0.5 percent.

Reuters polls also show economists are expecting a half-point cut from the Bank of England after its next meeting on Nov. 6 and at least 25 basis points from the European Central Bank by the end of the year.

Normally, such prospects of easier money would lift investor sentiment. But the problem for the authorities is that very little seems to be working as the worst financial crisis in 80 years turns into a global recession.

"Markets don't seem to be satisfied with anything at the moment," said Emiel van den Heiligenberg, an asset allocator at Fortis Investments.

One immediate area of concern is corporate earnings. Until recently, companies outside of the banking industry have performed reasonably well.

This is beginning to change - if not in the third quarter earnings that are being released, then in the outlooks that accompany them.

Global electronics giant Sony, for example, halved its profit forecast Friday, citing sagging demand for cameras and flat-screen televisions as well as currency fluctuations strengthening its home currency, the yen.

With about a third of the Standard & Poor's 500-stock index companies having reported, Thomson Reuters calculates that just more than 60 percent have been above market expectations. But that is the past, not the future.

Reports this week include those from U.S. Steel, Procter & Gamble, Legg Mason, Kraft Foods, MetLife and Sun Microsystems. In Europe, reporting companies include Banco Santander, BP, Alcatel-Lucent, France Telecom and Deutsche Bank.

Whether any positive surprises will have much long-lasting effect in the current climate remains to be seen.

People are looking for the light at the end of the tunnel, said Darren Winder, an equity strategist at Cazenove. "If they see light at the end of the tunnel they don't know if it's genuine light or if it's just another train coming."

Courtesy: European Currency Exchange | Reuters | International Herald Tribune

********************************

Currency Trading Education - The Best Free Sources to Help You Win
By Kelly Price

If you want to win at currency trading, you can buy advice but most currency trading education you need you can get for free and here we will look at how to find the best and enjoy currency trading success...

Let's first look at currency education that needs to be avoided.

Forex Expert Advisors

Most who claim they are not - anyone who claims they can make you money with no effort should be avoided.

If you want to see if an expert is a not qualified, look for the words "simulated" or "in hindsight", on the track record presented - this is not real trading and the track record is made up, to sell currency trading courses and systems.

Forex Forums

Want to find losers? Then currency trading forums are great. What trader who makes money uses them?

I don't know any. It's mostly losers who are trying to make themselves feel better, by dispensing their wisdom, or vendors trying to peddle their products - most of which are junk. Avoid Currency forums!

News Sources

We have better news than ever but traders need to learn 30 years ago before we had lots of currency news sources 95% of traders lost and 95% lose today, so improved news hasn't helped.

Prices don't move to the news, they move to trader's perception of. Try and trade breaking currency news and you will lose.

Brokers

Most broker education won't help you - if brokers were good at trading, they wouldn't be brokers! Also, as brokers mostly trade against you when you take a position, it's a conflict of interest.

Good Sources

So what about the good sources? Well the good news is:

There is plenty of it and you can get a good solid currency education for free.

The best way to trade is to use currency charts and base your market timing on technical analysis. There is plenty of free information on the basics, all the different indicators and charts for free, so you can look at the indicators, try them and come up with a simple, robust currency trading strategy.
Any currency trader, who wants to win, should also learn breakout trading and you will find a lot of information on this as well.

The fast is anyone can learn currency trading, there are no secrets and the reason most traders lose is - lack of discipline and poor money management and there is plenty of information on this too.

Traders simply lack discipline and CANNOT keep their losses small or trade through losing periods.

Worth the Money.

You can get some great information on discipline for free but I Would recommend spending $100 or so, on some books, from the really great traders, to get more insight into the mindset to succeed.

These are traders who have walked the walk and don't simply talk the talk. We reviewed our top ten in other articles so look them up - this is money well spent.

So in conclusion, you can get all the currency trading basics for success for free and can build a currency trading strategy - your major challenge though is money management and discipline.

Its here I would recommend spending a few dollars, if you don't think you have discipline ( and most traders don't) and then, the combination of a simple, robust, currency trading system and the right mindset to apply it, can help you win at currency trading.

Getting the right currency education is easy; getting the right mindset is what separates the small number of winners from the losing majority.

FREE FOREX TRADING SYSTEM!

For 2 essential free trading Pdf's and more FREE Currency Education and an exclusive RISK FREE Currency trading Course visit our website.

Article Source: EzineArticles.com/?expert=Kelly_Price

e-Currency Exchange - What You Need to Know Before Making any Decisions
By Dr Patrick Hillenbrand

How do I make money in E-Currency Exchange?

In brief, You profit by providing the means for others to exchange these different e-currencies for a fee. You do not speculate in currencies' fluctuations (although you can). Just as there are fees for using normal bank credit or debit cards, there are fees for using an e-currency exchange service. This is how you make money! You may think of it in terms of banking at a local bank. You deposit money into your savings account and the bank uses "your" funds to give to others in the form of loans for a house, a car etc. For depositing your money and allowing the bank to use that money the bank will in turn give you at best 1 - 4% interest over a WHOLE year (365 days).

At the same time, with e-currency exchange your money is deposited into a specific exchange account from where certain merchants can perform currency exchanges online within 24 hours sessions for others. For the privilege of using these funds there is payment to you, anywhere between 0.2% - 4.0% per 24 hours! which may be left in the account to compound on a daily basis. Naturally, the more you make available, the more you will make. Please note that these "fees" are guaranteed income for you.

e-Currency Exchange Facts

Fact: Most people double their money within 45 days.

Fact: e-currency Exchanging is very similar to having an account with a commercial bank and gaining interest from the bank's use of your money.

Fact: E-currency companies want as many people involved as possible to enable transactions from which they make a guaranteed return on every 24 hour exchanging cycle, you receive a commission from this transaction, thus your investment is 100% risk free.

Fact: Since you make your money based on TRANSACTIONS
you do not have the opportunity to lose money.

Fact: The biggest payment facilitators on the net, like Paypal, e-gold netpay etc. uses e-currencies. This is no hype, its real and the business is e-currency exchanging.

Fact: E-currencies and e-currency exchanging form an essential part of today's e-commerce and will continue to grow.

Fact: You can expect a guaranteed daily return of 0.2-5%

Fact: You need no prior interest or knowledge in financial markets or related areas. You need access to the internet and ability to understand English.

Fact: e-currency exchange is 100% flexible in terms of time. All transactions are per 24 hours cycles and you may choose to access your account at any time during this period or set to automatic.

Fact: Thriving growing community of e-currency exchangers, many forums and opportunities to learn and interact with other fellow traders.

E-Currency Exchange is a business in which your money is secure, you don't need to sell anything, and you don't need to bug your friends and family to join.

Learn more about e-currency exchange at www.bizoppjunction.com which explores different e-currency training providers and have answers to the top 25 most asked questions on e-currency exchange as well as testimonials & recommendations etc.

Dr. of Bus. Adm. (entrepreneurship) Patrick Hillenbrand is a self made entrepreneur living in Queensland Australia. With a corporate executive background from the Scandinavian IT outsourcing market, the last years has been devoted to researching & analysing online business opportunities. Many available with reviews at BizOppjunction.com

For direct link to e-currency homepage visit BizOppjunction.com/ecep_faq.html

Article Source: EzineArticles.com/?expert=Dr_Patrick_Hillenbrand

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Banks give you confidence, that there is no doubt, but we can offer you enough information on our procedure to qualify and quantify our service.

First and foremost we need to use a bank to transfer funds... We open a separate banking account for each transaction; and that is deemed as your account.

Secondly we don't accept an uncompetitive fixed rate from any bank or other financial institution. We negotiate directly on the currency trading floors. We deal with 10 main currencies, but can transfer funds into 150 other currencies. Some of these less common currencies are harder work than others; but we can discuss this should the need arise.

Using the currency trading floors as we do we can secure currency at a wholesale prices. We do not charge the same as a bank and this is where we can make the savings on your behalf.

We can truly offer you the best rates on the market because unlike other organisations, such as banks, with large offices, huge sales forces, enormous marketing costs and many different industry specialists (other than property), we have low overheads.

We can offer... Superior Currency Exchange Rates...

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(with the exception of 22 currencies in third world countries)

We can offer... incredible savings and reduce the risk of adverse currency fluctuations (see below)

Furthermore...

We can also offer... Arranging this transfer from the comfort of your own home...

We can also offer... Regular updates during the process of the transfer...

We can also offer... Receive confirmation that that the money has been exchanged and transferred

ADVERSE CURRENCY FLUCTUATIONS

Don't run the risk of fluctuations! We can by fixing a rate for your currency requirements today for a purchase in the future (up to 6 months).

Using an example... The Euro against the pound... 6 months ago was € 1.48/ Ł1.00; today it is € 1.32/ Ł1.00. On a Ł100,000 transfer the difference in those 6 months is Ł12,000

Case Study: Mr. and Mrs. Montague from Sheffield 17, were due to transfer Ł365,000 to buy a villas in Spain. Their completion had been planned for the end of the month, but they had notified us of their intentions. We are always scanning the currencies and notified Mr. and Mrs. Montague that the euro rate had reached € 1.47/ Ł1.00 and was expecting to go down in the forthcoming weeks. They agreed to secure the money at this rate. Three weeks later the rate had gone down to € 1.45/ Ł1.00 - not a big percentage drop but the Montague's saved Ł4,500 in securing the rate week's before.

OUR SERVICE

At Pounds-to-Euros.com we have established contacts around the world to make the transition of your money flow safely and securely. As specialists we focus exclusively on servicing your particular needs and desires and that is our only purpose. We don't carry our other banking facilities so our competence in this complex market is supreme.

Both my colleagues and I try to supply you with all the information you need to make good decisions about your money. We watch the currencies by the hour as they all strengthen and weaken during the trading day. Such knowledge is invaluable as advice to you when making decisions about the currency markets.

As in office focus is 80% to 20% - Private Property Purchases to Commercial Purchases, we only have two particular areas to concentrate on. We work hard to proactively understand new markets, up-coming hot spots, financial issues and the overall buying process for your benefit.

Each week, we transfer millions of pounds for hundreds of our clients. It's all done highly effectively and efficiently through tried and tested processes and procedures. We focus on providing the best currency exchange rate, getting the payment to the destination account as quickly as possible and giving an outstanding service.

We've been trading since 1991, are registered in the UK.

One final bit of advise... If you use our service or not... Plan your currency exchange at least a month (or even 3 to 6 months) in advance to get the best exchange rate. Don't leave it until the last minute.

HOW DO WE MAKE OUR MONEY?

We make our money the same way the bank does - we buy currency at wholesale on the currency trade floor (in bulk); and transfer to the receiving bank in your requested account. Unlike banks that add 3-5% margin, we can usually stay below 1%. In the end, you save money, we get paid for our great service and the banks exploit one less person!

Don't forget this is what we offer...

We can offer... Superior Currency Exchange Rates...

We can offer... No Fees or Commission...

We can offer... No Telegraphic Transfer Costs...

(with the exception of 22 currencies in third world countries)

We can offer... incredible savings and reduce the risk of adverse currency fluctuations (see below)

Furthermore...

We can also offer... Arranging this transfer from the comfort of your own home...

We can also offer... Regular updates during the process of the transfer...

We can also offer... Receive confirmation that that the money has been exchanged and transferred

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ADVERSE CURRENCY FLUCTUATIONS

Don't run the risk of fluctuations! Currency Brokers, can, by fixing a rate for your currency requirements today for a purchase in the future (up to 6 months).

Currency Example... The Pound against the Euro... 16 months ago was €1.48/ Ł1.00; 6 months later it was €1.32/ Ł1.00. On a Ł100,000 transfer the difference in those 6 months is Ł12,000

For full story - Click Here - Adverse Currency Fluctuations

CURRENCY NEWS -

Pounds - Dollars - Euros

Currency - Pounds - Dollars - Euros - were all given a slight boost following a drop in oil prices on Wednesday 23rd. The dollar rose against the Yen, Euro and Swiss Franc.

For full story - Click Here - Pounds - Dollars - Euros

CURRENCY CASE STUDIES -

Case Study
In November 2007 Simon from Gloucestershire wanted to invest in a property in Miami, mainly because the dollar was weak against the pound. He had Ł175,000 to invest which was going to buy him a substantial property. He'd been given a quotation from his bank at US $1.80 / Ł1. A broker in comparison could achieve US $1.84 to the Ł1; plus of course these brokers don't charge any incidental fees. Simon if he would have gone through his bank would have got $315,000; but because he chose a broker they were able to secure $322,000. This saved Simon $7,000 almost Ł3,400

Case Study
In August 2007 there was Jayne from Southampton, she was buying a property in Almeria, Spain. Her transfer was for a villa at Ł325,000; a superb 5 bedroom villa with sea views. Her bank had frightened her with the exchange rate, so she decided to look elsewhere; fortunately she came to a brokers website. She was offered an exchange rate of US €1.39 / Ł1; they were able to offer €1.41 / Ł1. This meant had she continued with the bank she would have realised €451,750 - however fortunately the broker service could manage €458,250; saving Jayne €6,500 (Ł4,600)

Case Study
In September 2007 Dominique wanted to buy an Apline ski home in Austria. The property was valued at Ł295,000. He hadn't gone to the bank as he had heard that the banks weren't always the best choice. A broker will be fully aware of what the banks charge at what rates they work with: Barclays on this day was working with an exchange rate of €1.35 / Ł1; the broker on the other hand could get €1.38 / Ł1. Using Barclays, Dominique would have received €398,250; whereas the broker actually secured him €407,100 which has a difference of €8,850 (Ł6,400).

CURRENCY ARTICLES -

Buying Property Abroad and Moving Abroad - Top Financial Tips

I was once interviewing a BBC Radio presenter in my previous journalistic capacity and he said something that has rang true with me ever since.

For full story - Click Here - Buying Property Abroad

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If you have more than Ł10,000 to change then we can save you between Ł500 to Ł15,000. We buy the currency wholesale, as do the banks, but we don't charge the same profit margins. Allow us to quote and you'll be surprised.

Just fill in the 20 second request form below and we'll provide a free no obligation quote.

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CASE STUDIES

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Case Studies

Australian dollar survives wild week
By Stephen Johnson | November 02, 2008

WATCHING the Australian dollar last week was like being on a rollercoaster ride after lunch.

The currency, known in foreign exchange markets as the "Aussie'', dropped to a five-and-a-half year low on Tuesday as fears of a global recession spooked traders.

But two days later the resilient Aussie battler, the world's fourth most traded currency, had staged a 15 per cent comeback.

Optimistic market strategists say the Australian dollar is undervalued and could test US80c again by Christmas as a recovery in commodity prices and a renewed confidence in financial markets makes risk-sentiment currencies more attractive.

Conversely, a London-based currency strategist says that in a worse-case scenario the Australian dollar could sink to US40c, a level below the all-time low of US47.78c touched in April 2001.

The nerves of global jet setters, and importers looking to sell their goods in Australia, were tested this week as the Australian dollar threatened to fall below 60 US cents for the first time since April 2003.

The situation became so drastic the Reserve Bank of Australia (RBA) intervened in the foreign exchange market - three times over four days - to prop up the ailing unit.

At its low point on Tuesday morning - US60.12c - the Australian dollar was 40 per cent below July's 25-year high peak of US98.49c, yet two days later, the currency was sailing close to US69c.

Against the low-risk Japanese yen, meanwhile, the Australian dollar sunk to its lowest levels since the end of World War II - 55.10 yen - but two days later it had regained a fifth of its value.

The Australian dollar's steepest slide since being floated in late 1983 has been even more dramatic than in the aftermath of the Asian financial crisis of the late 1990s, and the 2001 world slowdown following the tech wreck.

But that's about to change, says Suncorp group treasury strategist Peter Pontikis.

"It doesn't get any worse from here,'' he told AAP.

Mr Pontikis said the Australian dollar was undervalued and would test US80c by Christmas as global credit conditions improved.

The US Federal Reserve's decision to buy commercial paper would add liquidity to financial markets and ease credit crunch constraints which have turned traders off currencies like the Australian dollar, which is being battered by negative global economic sentiment.

Conversely, Carlin Doyle, a London-based strategist at State Street Global Markets, said the Australian dollar could fall to US40c next year if co-ordinated world central bank action to tackle the credit crunch failed to improve risk sentiment.

"That's, like, the worst-case scenario: we've got the Aussie down at US40c but it's unlikely that will happen,'' he said.

"But it's also going to be out there.''

Mr Doyle said the Australian dollar was more likely to stabilise at existing levels, and not return to the US90c range.

ANZ senior currency strategist Tony Morriss said dire global conditions would hinder any sustained recovery in the Australian dollar next year.

"There's a good chance we'll get above US70c but when you look further ahead at the Reserve Bank cutting rates and the sober outlook for global growth it's hard to make the case for the Aussie getting above 80 (US cents),'' he said.

"Global growth remains weak and that's never a good environment for the Aussie.''

The biggest contraction in the US economy in seven years - 0.3 per cent in the three months to the end of September - has stoked worries about an American recession.

Since July, commodities-driven currencies like the Australian and Canadian dollars, along with the Brazil real and the South African rand, have been sold off as fears of a global recession have intensified.

The Australian dollar's fall from grace has mirrored a slump in the Reuters/Jeffries-CRB index, an average of commodity futures traded in the US and the UK.

This index has fallen by 45 per cent since July to hit its lowest point since late 2003 - much like the Australian dollar - but Mr Pontikis said this measure of commodity prices was likely to improve.

"A lot of it has been based on fear not fundamentals: in essence we'd be looking at a recovery story as the world calms down,'' he said.

Signs of recovery emerged on Wednesday morning as an 11 per cent jump on Wall Street pushed the Australian dollar above US65c.

A day later, double-digit surges in key commodity prices like copper propelled the Australian dollar close to US68c in morning trade.

Even if the currency falls again, there would still be reasons to celebrate, even if overseas holidays and imports became more expensive.

AMP Capital Investors chief economist Shane Oliver said a weaker Australian dollar would help offset the effects of a sharp economic downturn.

"It makes our exports more competitive on the global market and it also boosts income offshore: 30 per cent of company profits are made offshore,'' he said.

"If the Australian dollar goes down, their profits in Australian dollars go up.''

Dr Oliver said that meant a weaker Australian dollar would act as a buffer against rising unemployment.

The jobless rate, now at 4.3 per cent, would rise to 6.5 per cent by the end of 2009, instead of nine per cent, because of a weaker Australian dollar, he said.

In early 2001, the RBA intervened in the foreign exchange market to prop up the Australian dollar as it hit an all-time low under US48c.

The central bank was at it again - on Friday night, Monday and on Tuesday - as the Australian dollar struggled.

The currency had little reaction to the US Fed's decision to cut a key interest rate to one per cent for the first time since mid 2004, because the half a percentage point easing, announced on Thursday morning, was widely expected.

Economists are expecting the RBA to cut domestic interest rates by 50 basis points on Melbourne Cup day, which would take the cash rate to 5.5 per cent for the first time since May 2006.

ANZ's Mr Morriss said it was becoming more difficult than ever to make predictions about the Australian dollar.

"The level of volatility of beyond anything in the modern era,'' he said.

Keep some antacid tablets handy for the next rollercoaster ride.

Courtesy: Online Currency | theaustralian

.news.com.au

CURRENCY NEWS -

BOJ keeps hand out of currency jar
Sunday, Nov. 2, 2008 |

October despite the yen leaping to its strongest level in more than 13 years against the dollar, the Finance Ministry said.

The ministry did not conduct currency intervention via the Bank of Japan from Sept. 29 to Oct. 29, and hasn't done so since March 17, 2004.

On Oct. 24, the dollar briefly entered the upper Ą90 range in London for the first time in 13 years and two months as prospects darkened for the global economy.

The Group of Seven economies expressed concern about the yen's rapid appreciation versus the U.S. dollar and other major currencies in an emergency statement released Monday — at the request of the BOJ.

Currency policy is controlled by the Finance Ministry, with the Bank of Japan acting as its agent.

Tokyo conducted sales of more than Ą35 trillion in the 15 months from January 2003 through March 2004 to stem the yen's sharp rise against the dollar. A stronger yen hurts exports, the main engine of Japan's economic growth.

Courtesy: search.japantimes.co.jp | Currency Abroad

NT dollar enjoys biggest weekly gain since March
FOREIGN EXCHANGE: Although the NT dollar on Friday pared its solid advance for the week, it contributed to regional currency strength, an IDEAglobal analyst said

BLOOMBERG
Sunday, Nov 02, 2008, Page 10

The New Taiwan dollar had the biggest weekly gain against the greenback in eight months on speculation governments around the world will provide further support measures to stem the deepening global economic slump.

The NT dollar gained 1.2 percent this week after the IMF said it has sufficient money available to meet current demand for loans from member nations. US Federal Reserve Chairman Ben Bernanke signaled he’s ready to cut the benchmark interest rate to the lowest level on record, after a half-point reduction to 1 percent.

“There were a number of factors which contributed to the regional currency strength, including the Taiwan dollar,” said Maya Pinto, an economist at IDEAglobal in Singapore. “A combination of things helped in curbing risk aversion. We think volatility and aversion will still be around and we expect to see currency weakness re-emerge”

Taiwan’s currency weakened 0.6 percent to NT$33 against the US dollar as of the 4pm close on Friday, paring the weekly advance, Taipei Forex Inc said. The weekly gain is the steepest since the week ended March 1.

Taiwan’s 10-year government bonds were little changed. The yield on the benchmark 2.125 percent bond maturing September 2018 climbed 0.3 basis point for the week to 1.977 percent, according to the GRETAI Securities Market, Taiwan’s biggest exchange for bonds. Its price fell 0.0307, or NT$30.7 per NT$100,000 face amount, to 101.3109. A basis point is 0.01 percentage point.

The central bank reduced the discount rate on 10-day loans to banks to 3 percent from 3.25 percent effective immediately, bank Governor Perng Fai-nan (彭淮南) said in a press conference in Taipei on Thursday.

The MSCI Asia-Pacific Index of regional stocks dropped as much as 2.5 percent on Friday, snapping a three-day rally, after the US reported the largest drop in GDP since 2001. Eight of the most active Asian currencies outside of Japan fell.

Indonesia’s rupiah completed its worst month since 1998 as overseas investors sold more Indonesian shares than they bought.

The rupiah fell 2.5 percent on Friday to 10,975 per dollar in Jakarta, Bloomberg data show. The currency slumped 13 percent last month.

Non-deliverable forwards contracts show traders are betting the rupiah will weaken 7 percent to 11,800 in a month, compared with 11,475 on Thursday.

The yen rose against the euro on Friday as signs of a global recession prompted investors to sell higher-yielding assets funded by low-cost loans in Japan.

Japan’s currency also advanced against the Australian and New Zealand dollars as commodities including gold and copper fell.

“Investors had positions using the dollar or yen to invest in the euro or emerging-market currencies,” said Masataka Horii, one of four investors for the US$47.9 billion Kokusai Global Sovereign Open fund in Tokyo, the biggest bond fund in Asia. “Now people are rushing to close that position.”

The yen climbed to ￥123.9 per euro in Tokyo on Friday from ￥127.31 on Thursday in New York. Against the dollar, it was at ￥97.01, from ￥98.61.

South Korea’s currency dropped for the first time in three days after manufacturers’ confidence tumbled to a record low and factory output fell for a third month, adding to concern the economy may sink into its first recession since needing an IMF bailout in 1997.

The won weakened 3.2 percent to 1,291 per dollar, Seoul Money Brokerage Services Ltd said.

Malaysia’s ringgit traded at 3.5453 per US dollar on Friday in Kuala Lumpur, according to data compiled by Bloomberg. The currency weakened 3.1 percent last month.

Elsewhere, the Philippine peso weakened 0.5 percent to 48.945, Vietnam’s dong was little changed at 16,830, Singapore’s dollar lost 1.5 percent to S$1.4845 and India’s rupee strengthened 0.6 percent to 49.435.
Courtesy: Exchanging Money Abroad | Bloomberg | taipeitimes.com

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