Forex NEWS by RTT in partnership with InstaForex

[IFX Darika]

Dollar Nearing December 2008 Lows Versus Euro

The dollar came under further pressure versus the euro and continued its trek toward parity against the surging loonie Monday morning in New York.

Rising global stocks and speculation that the economy is on the mend have fueled increased appetite for riskier higher yielding currencies.

Traders were looking ahead to a fairly busy week on the economic front, kicked off by the Commerce Department's new home sales report for June.

The consensus estimate for the report coming at 10 AM ET this morning calls for an increase in new homes sales to 352,000.

New home sales declined 0.6% in May from the previous month to a seasonally adjusted annual rate of 342,000.

The dollar remained on the defensive versus the euro, dropping to an 8-week low of 1.4296, just shy of its lows from last December. A move to 1.4340 would take the dollar to its lowest level since the last week of 2008.

There was no relief for the dollar versus the scorching-hot loonie. Amid growing evidence that the Canadian economy is in much better shape than its neighbor to the south, the dollar dropped to C$1.0780, its lowest level since September 2008.

The dollar extended its run of choppy trading versus the sterling, easing to 1.6500 after seeing some modest strength late last week.

Versus the yen, the dollar firmed up slightly to 95.20, staying near a monthly high of 95.28.

In economic news from around the globe, German consumer confidence for August improved strongly, suggesting a recovery in the economy that is hit hard by recession.

According to the latest consumer climate survey from the market research firm GfK, the forward-looking consumer sentiment index rose to 3.5 points for August.

Monday, the quarterly report from the Bank of England said the continued asset purchases in the second quarter were accompanied by signs of improvement in the corporate credit markets.

News are provided by InstaForex.

 

[IFX Darika]

IMF Advises Indonesia To Continue Stimulus Measures In 2010

The International Monetary Fund welcomed Indonesia's fiscal stimulus plan for 2009, underscoring timely and efficient implementation of the spending program. The Washington-based agency urged Indonesia to maintain some of the stimulus measures next year.

The Executive Board of IMF noted that private consumption supported by the fiscal stimulus package helped to maintain positive economic growth. However, another round of global risk aversion could adversely affect nation's external liquidity, demand and growth prospects. To withstand these risks, the authorities should strive to achieve the appropriate policy mix and promptly adjust it as needed to preserve macroeconomic and financial stability.

The board assessed that the current level of the real effective exchange rate is broadly in line with fundamentals and that reserves are at a comfortable level. Some others believed that the current level of reserves and the various contingency arrangements should provide an adequate cushion.

Regarding inflation, the fund said, "Strong commitment to the medium-term inflation targets, as well as publication of inflation forecasts, would help guide inflation expectations and enhance policy credibility."

News are provided by InstaForex.

 

[IFX Darika]

Trust In Business Recovering In World Markets: Survey

The public's trust in business has stabilized and is recovering significantly in some of the world's largest markets, results of a survey conducted by Edelman, a leading independent public relations firm, showed Thursday.

Edelman's previous survey, conducted in January, showed a devastating loss in trust in the private sector.

The mid-year survey was conducted among 1,675 informed public in six countries - the U.S., the U.K., France, Germany, India, and China.

The survey found that India and China are the most positive about business. At 75%, India recorded the highest level of trust in business of any of the six countries surveyed. China followed with 60% saying they trust business to do what is right.

"The private sector is perceived as enabling an economic growth that has led to healthier living standards. The survey numbers reflect a high degree of national pride in the accomplishments of business," said Alan VanderMolen, president, Asia Pacific, Edelman.

In the U.S., 48% of informed public trust business to do what is right, up from a low of 36% in January. The figure for France rose to 41% from 30%.

"Trust in business is on the way back, but we're still in the middle of the game," said Richard Edelman, president and CEO, Edelman.

The public's trust in government rose the most in India, an increase of 13 points to 55% followed by the U.S., where the trust barometer rose 12 points to 42%.

News are provided by InstaForex.

 

[IFX Darika]

German Retail Sales Fall Unexpectedly In June

German retail sales dropped unexpectedly in June despite rising consumer confidence and low price level as recession continued to put pressure on consumer spending.

According to a provisional report from the Federal Statistical Office, retail sales for June recorded a surprise monthly decrease of 1.8% in real terms, following a revised 1.3% drop in May. Economists were looking for a 0.3% rise.

Year-on-year, sales slipped 1.6% in June, smaller than a revised 3.7% fall seen in May. The annual decline was also unexpected as economists were looking for an increase of 0.9%.

For the January to June period, retail turnover dropped 2.1% in real terms compared to the corresponding period of the previous year. Sales were down nominally by 2.3%.

In nominal terms, retail sales dipped 2% year-on-year and 1.6% from the prior month in June.

Simon Junker, Commerzbank analyst said in a note that German retail sales proved to be stable despite severe recession, probably because of the still stable labor market and the low price level. The crisis has reached retail too, supporting the judgment that the largest Eurozone economy shrunk again in the second quarter, albeit only moderately, he said.

According to the analyst, the German economy would possibly pick up in the months ahead, though retail may not benefit very much in the coming months. At most, the favorable price trend could strengthen purchasing power and support sales. However, rising unemployment would dent retail sales again.

German unemployment decreased in July, which was the first decline since October 2008. Meanwhile, the jobless rate stood at 8.3%, unchanged from June.

Consumer confidence and business climate in the economy showed improvements in recent months as a result of Chancellor Angela Merkel's spending plan. Merkel is seeking a second-term in office in September elections.

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[IFX Darika]

Fitch Maintains Stable Outlook For Malaysian Banks' Credit Ratings

Thursday, Fitch Ratings maintained the stable outlook on Malaysia's local banks' credit ratings, despite very weak macro economic indicators.

The firm said the probability of capital impairment for Malaysian banks still appeared fairly low, despite the extremely stressed macro economic conditions and the reasonably-stressed assumptions simulated by the agency. Fitch said this in the context of its report titled "Stress Test on Malaysian Banks", where it attempts to simulate a fairly-stressed scenario for Malaysian banks.

The firm also noted that although banks' earnings were likely to be lower in 2009 and 2010 compared with 2008, they appeared adequate to fully absorb the credit costs associated with asset quality deterioration. This means their loss absorption capacity would likely remain adequate and financial strength largely intact, Fitch said.

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[IFX Darika]

Pace Of Deterioration In U.K. Job Market Slowing: CIPD/KPMG Survey

The pace of deterioration in the U.K. job market is slowing as private sector demand for staff began to stabilize following a surge of redundancies earlier in the year, results of the latest quarterly CIPD/KPMG labor market outlook survey revealed Monday.

The survey of more than 900 employers in all sectors of the economy found that not only are far fewer employers expecting to make staff redundant but the scale of planned redundancies has also reduced. However, signs of improved employer optimism in the private sector are offset by mounting pessimism in the public sector.

"When it comes to the immediate jobs outlook, the best that can be said is that things are getting worse more slowly," John Philpott, chief economist at the CIPD said. But, he warned that "It is far too soon to rule out another avalanche of private sector redundancies later in the year." According to the survey, employment will keep falling and unemployment is still on course to top 3 million in 2010. Due to a fall in expected redundancies, the private sector unemployment would be less compared to the public sector.

The balance of private firms cutting over those recruiting fell to minus 2 from minus 30 recorded in the spring. By contrast, in the public sector the negative balance has increased from minus 3 to minus 28.

Moreover, the survey found that the pay outlook has worsened, with only 15% of respondents planning to conduct a pay review this quarter, compared to 32% in the previous quarter.

Andrew Smith, chief economist at KPMG said, "This conservative approach indicates that business remains unconvinced that current economic green shoots will lead to sustainable healthy growth in the near term."

Average pay increase expectations have dropped below the rate of inflation to 1.7%. Smith said this will result in a reduction in real earnings and could stifle any consumer led recovery.

News are provided by InstaForex.

 

[IFX Darika]

Yen Extends Uptrend As Asian Stocks Drop

Wednesday, the yen extended its yesterday's uptrend against other major currencies as Asian stocks tumbled today and prompted investors to further liquidate yen short positions ahead of a policy statement from the U.S. Federal Reserve later in the day.

Asian shares plunged today after losses on Wall Street and as investors locked in profits as they waited to hear what the U.S. Federal Reserve would say about prospects for recovery in the world's largest economy.

Japan's Nikkei 225 was down 1.17%, South Korea's Kospi Composite fell 0.87%, Hong Kong's Hang Seng was 1.93% lower while China's Shanghai Composite slipped 2.93% and Taiwan's main index dropped 0.15%.

The Fed will conclude its two-day policy meeting and release a statement around 2:15 pm ET today, with investors looking to its assessment of the economy and whether it unwinds some of the unconventional easing measures currently in place.

There is mounting speculation that Fed might grow more optimistic about a recovery after a better-than-expected jobs report for July.

The U.S. Labor Department report showed that non-farm payroll employment fell by 247,000 jobs in July following a revised decrease of 443,000 jobs in June. Economists had been expecting employment to fall by 325,000 jobs compared to the drop of 467,000 jobs originally reported for the previous month. The Labor Department also said that the unemployment rate unexpectedly edged down to 9.4% in July from 9.5%, recording a decrease for the first time since April 2008.

The Fed has kept its target rate for overnight loans between banks in a range from zero to 0.25 percent since December. The Federal Open Market Committee will keep rates unchanged today, analysts expect. The central bank has bought $252.761 billion of U.S. Treasuries since it announced a six-month plan in March to purchase $300 million of Treasuries to help keep borrowing low.

Japan's corporate goods price index fell at a record pace in July, adding to concerns that deflation in the world's second largest economy is accelerating.

The Bank of Japan's CGPI data, which tracks prices of domestically produced and used goods traded among companies, plunged 8.5% in July from a year earlier, breaking the record 6.7% drop set in the previous month. Moreover, this was the seventh consecutive month of decline.

Today's results will likely heighten fears of persistent price falls in Japan, as overall economic activity has yet to show signs of a full-fledged recovery.

Still, BOJ Governor Masaaki Shirakawa said at a regular press conference on Tuesday that the BOJ doesn't expect Japan to fall into a deflationary spiral now, though "it may take time for falls in prices to end."

On a monthly basis, the domestic CGPI rose 0.4% in July, following the 0.3 percent decline in the previous month.

Meanwhile, a final report from the Ministry of Economy, Trade and Industry showed that Japan's industrial production growth in June came in at 2.3% on a monthly basis, revised down from 2.4% estimated initially. From the previous year, production plunged 23.5%.

The yen that closed yesterday's trading at 96.01 against the dollar strengthened to a 5-day high of 95.35 during Asian deals on Wednesday. The next upside target level for the yen is seen at 94.7.

The yen plunged to near an 8-week low of 97.80 against the dollar on August 07 as the dollar gained 2% on that day following better-than-expected U.S. jobs data.

But the yen is showing strength this week on encouraging economic reports from Japan. Reports showed this week that Japan's current account surplus and the machinery orders rose more than expected in June. Thus far, the yen has advanced 2.5% against the dollar.

In Asian trading on Wednesday, the yen rose to a 9-day high of 134.91 against the euro. This may be compared to yesterday's closing value of 135.84. On the upside, 133 level is seen as the next target for the Japanese currency.

After hitting a 2-month low of 138.73 against the euro on Friday, the yen has appreciated 3% thus far.</p>

<p>The yen jumped to a 12-day high of 157.29 against the pound in Asian deals on Wednesday. If the yen edges up further, it may likely target the 154.2 level. The pound-yen pair was worth 158.21 at yesterday's close.

Thus far this week, the yen has depreciated 3% against the pound.

During Asian deals on Wednesday, the yen soared to a 12-day high of 88.16 against the Swiss franc. The next target level for the Japanese currency is seen at 87.1. At yesterday's close, the franc-yen pair was quoted at 88.78.

The yen that slumped to near an 8-week low of 90.74 against the franc on Friday has gained 3% since then.

In Asian deals on Wednesday , the yen jumped to a 13-day high of 78.47 against the Aussie and an 8-day high of 63.33 against the NZ dollar. The next upside target level for the yen is seen at 77.0 against the aussie and 63.0 against the kiwi. The aussie-yen pair closed trading at 79.63 and the kiwi-yen pair at 64.09 on Tuesday.

Consumer confidence in Australia rose to a near two-year high in August, as reported today by Westpac Bank and the Melbourne Institute. The group said its index of consumer sentiment was up 2.7 percent compared to July, reaching its highest level since October 2007. The index has increased 27.8 percent since May, making it the sharpest three-month gain since the survey's inception in 1975.

Against the Canadian dollar, the yen surged up to a 2-week high of 86.53 in Asian trading on Wednesday. On the upside, 86.3 is seen as the next target level for the Japanese currency. At yesterday's close, the loonie-yen pair was quoted at 87.15.

The loonie declined as oil steadied below $70 a barrel today after four consecutive days of losses as the market waited for a second set of U.S. inventory data and kept an eye on the outcome of the U.S. Federal Reserve's two-day meeting.

U.S. light crude for September delivery rose 9 cents to $69.54 a barrel in Asian deals, having lost $1.15 on Tuesday on Wall Street losses and after the Energy Information Administration (EIA) revised lower its global oil demand forecast. London Brent crude fell 6 cents to $72.40.

Looking ahead, the French July CPI and June current account, Italian final July CPI, Euro-zone June industrial production, U.K. labor market reports as well as the Bank of England's quarterly inflation report are expected to influence trading in the upcoming session.

From the U.S., the trade balance report for June is due at 8:30 am ET.

At the same time, the Canadian June trade balance and new housing price index reports are scheduled for release.

News are provided by InstaForex.

 

[IFX Darika]

Dollar Declines Against European Majors

The US dollar that showed signs of recovery against most of its major rivals immediately following the release of the S&P/Case-Shiller home price index for June lost ground shortly. As of 9:10 am ET, the greenback drifted lower to 1.0571 against the Swiss franc, 1.6447 versus the pound and 1.4362 against the euro.

The report showed that the S&P/Case-Shiller 20-City Composite Home Price Index fell at an annual rate of 15.4 percent in June compared to a revised 17 percent drop in May. Economists had expected prices to fall 16.4 percent compared to the same month a year ago.

News are provided by InstaForex.

 

[alessio09]

Mixed Results fro Euro

The EUR extended gains versus the GBP on Wednesday, to trade above $0.8775 amid a wide sell-off in the GBP. The EUR performed the same versus CHF as the pair inclined from 1.5185 to 1.5220 by the end of trades. The EUR saw bearishness as well against the USD as it lost over 50 pips and closed session at 1.4249.

 

[IFX Darika]

UK House Prices Rise For Fourth Month In August - Nationwide

House prices in the UK rose for the fourth consecutive month in August, increasing by 1.6% month-on-month on a seasonally adjusted basis, the Nationwide building society said Thursday. Economists had forecast house prices to grow only 0.5% after a revised increase of 1.4% in July.

Compared to the previous year, house prices fell 2.7% in August, much slower than the 6.2% decline seen in July. The average price of a typical UK property stood at GBP 160,224, up from GBP 158,871 in July.

Over the first eight months of 2009, the seasonally adjusted index of house prices has risen by 3.2%, though relative to the October 2007 peak it is down by 14.4%, the Nationwide said.

News are provided by InstaForex.

 

[IFX Darika]

Doing Business In China Getting Harder, European Business Lobby Says

European businesses feel doing business in China is getting harder, a report from the European Union Chamber of Commerce in China showed Wednesday.

In its business position paper 2009/2010, the business lobby said European businesses have observed a slowdown after China made strict regulations over the past twelve months, with some sectors reporting that the situation has actually gotten worse as industrial-policy interventions and foreign investment restrictions have increased.

The European Chamber urged China to open up its markets and to make fundamental reforms to maintain the attractiveness of China as an investment destination for European businesses. Such moves will also help China to build a sustainable economic recovery.

"European businesses believe that the current economic crisis provides a prime opportunity for China to restructure the economy and build a transparent and fair business environment for all companies, both domestic and foreign."

The European Chamber believes that China can play a proactive role in easing trade tensions by arresting the regression in the reform process observed in many industries and adopting measures to build a level playing field for all businesses in China.

"Such moves would also serve to boost investment and domestic consumption, and in turn enable the Chinese economy to achieve its latent potential."

"Over the past year, the European Chamber has noted a gradual slowdown - and in some cases a partial reversal - in the economic opening up process," said Joerg Wuttke President of the European Chamber.

However, China's experience in the last three decades has clearly proved that it is precisely in periods of crisis that increased opening and reform has bred the greatest success.

"We are convinced that this is an ideal moment for China to adopt a new and bolder cycle of reforms, a move that would ensure that China maximizes its growth potential over the next five to ten years," Wuttke said.

The European Chamber will be presenting its paper to government and regulatory agencies in China, to the European Commission and EU member state governments, and to a wide range of business organizations and companies in China and Europe.

News are provided by InstaForex.

 

[IFX Darika]

Crude Oil Slips Slightly, Remains Near $68

Crude oil prices saw little change for a second straight session on Thursday, remaining near the $68 per barrel mark. Traders looked ahead to the jobs report on Friday

Light sweet crude for October fell to $67.96, down nine cents on the session. Prices touched as high as $69.40 after earlier hitting as low as $67.66.

The Labor Department's non-farm payroll report is expected at 8:30 a.m. ET tomorrow. Jobs are expected to drop by 225,000 jobs in August, compared to a drop of 247,000 in July. The unemployment rate is expected to inch up to 9.5%, compared to 9.4% a month earlier.

In economic news, the Labor Department reported jobless claims edged down to 570,000 from the previous week's revised figure of 574,000. Economists had been expecting jobless claims to slip to 564,000 from the 570,000 originally reported for the previous week. The Labor Department's monthly employment situation report is due tomorrow.

Later, the Institute for Supply Management said its index of activity in the service sector rose to 48.4 in August from 46.4 in July, with a reading below 50 indicating a contraction in the sector. Economists had been expecting a slightly lower reading of 48.0.

On Wednesday, the Energy Department revealed U.S. commercial crude oil inventories decreased by 400,000 barrels in the week ended August 28 to reach 43.4 million barrels. Experts were looking for a drop of about 1.9 million barrels. Total motor gasoline inventories decreased by 3.0 million barrels last week.

News are provided by InstaForex.

 

[IFX Darika]

US Dollar And Japanese Yen Falls As Stocks Rise

During early deals on Monday, the US dollar and the Japanese yen edged down against their major counterparts as a rise in Asian and European stock prices reduced demand for currencies perceived as safe havens.

The dollar and the yen are viewed as safe-haven currencies and both currencies gain, when investors turn risk averse and fall when risk appetite improves.

The dollar slipped to a 6-day low against the European currency, 13-day low versus the British pound, 4-day low against the Swiss franc, while edged higher to a 6-day high against the Japanese yen.

Against the European currency, the US dollar edged down during early deals on Monday. At 3:05 am ET, the dollar touched a 6-day low of 1.4363 against the euro, compared to 1.4312 hit late New York Friday. The next downside target level for the US currency is seen around 1.445.

The Sentix investor confidence indicator for the Eurozone rose to minus 14.61 in September from minus 17 in August. Economists had forecast a reading of minus 13.7. Among the sub-indicators, the current situation index moved to minus 32.75 from minus 39, while the expectations index fell to 5.50 in September from 8 in August.

The US currency that closed Friday's North American session at 1.6399 against the British pound slipped to a 13-day low of 1.6445 at 3:35 am ET Monday. The pound-dollar pair is currently trading at 1.6419 with 1.660 seen as the next target level.

Against the Swiss franc, the greenback traded down during Monday's early deals. At 3:05 am ET, the dollar-franc pair declined to a 4-day low of 1.0558, compared to Friday's closing value of 1.0603. If the pair falls further, 1.054 is seen as the next target level for the pair.

The US dollar gained ground after hitting a low of 92.95 against the Japanese yen during today's early Asian deals. At 4:15 am ET, the dollar-yen pair climbed to a 6-day high of 93.31. On the upside, 93.6 is seen as the next target level for the pair. The pair closed Friday's New York deals at 93.01.

The Japanese yen showed weakness against its major counterparts during today's early deals.

The Japanese currency edged down to a 10-day low of 153.29 against the British pound and a 6-day low of 133.89 versus the European currency during today's early deals. If the Japanese yen falls further, 154.1 against the pound and 134.5 versus the euro are seen as the next target levels. The yen closed Friday's deals at 152.53 against the pound and 133.11 against the euro.

Against the Swiss franc, the Japanese unit showed weakness during today's deals. At 4:15 am ET, the yen slipped to a 6-day low of 88.32 against the franc, compared to Friday's closing value of 87.76. The next downside target level for the Japanese yen is seen around 88.6.

The U.S. financial markets are closed today in observance of the Labor Day holiday.

News are provided by InstaForex.

 

[IFX Darika]

Trichet: Global Economy Probably Out Of Freefall

The global economy is probably out of freefall and stabilizing faster than previously expected, European Central Bank President Jean-Claude Trichet said Monday.

"We are probably in large part of the global economy out of the period of free-fall," he said at the end of a discussion held at the Bank for International Settlements, Basel, Switzerland.

Trichet, who chairs the oversight body of the Basel Committee on Banking Supervision, said the outlook for the global economy had brightened and the recovery would be faster than anticipated.

"We have to remain prudent and cautious and it's not excluded we will have a bumpy road. Uncertainties are big," Trichet said. He stated that the current situation still requires "caution, prudence and alertness."

Further, Trichet pointed out that protectionism and imbalances in the world economy are the two main risks to a recovery.

"Authorities and the private sector will not be forgiven if we again have to cope with a situation as dramatic as the one we have had to cope with in September last year," Trichet warned.

He also noted that reforms are necessary to strengthen the financial system to avoid further risks.

Late on Sunday, leading central bank governors and banking regulators agreed on a new set of measures to strengthen supervision of the global banking system. With the new rules in force, banks would be required to earmark major part of their profits as reserve to use in tough times.

News are provided by InstaForex.

 

[herry_fxhope]

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[IFX Darika]

European Economics Preview: BoE Expected To Retain Key Rate

Thursday, the Bank of England is set to announce its interest rate decision. The central bank is widely expected to leave the interest rate untouched at a record low of 0.5% and to continue its GBP 175 billion asset purchase programme.

At 2.45am ET, the French statistical office INSEE is scheduled to issue industrial production data. Month-on-month, industrial production is forecast to rise 0.4% in July and manufacturing output growth is seen at 0.5%.

Thereafter, the Hungarian CPI and Turkish GDP reports are due. Economists forecast Hungarian annual inflation to rise to 5.8% in August from 5.1% in July. The Turkish economy is forecast to shrink 8% annually in the second quarter.

Half an hour later, consumer prices details are due from Denmark and Sweden. Sweden consumer prices are forecast to drop 1% annually in August compared to a 0.9% fall in July. Meanwhile, Danish annual inflation is expected to rise to 1.1% in August from 1% in July.

At 4.00am ET, the European Central Bank is set to issue monthly bulletin. In the meantime, Norwegian CPI and PPI reports are also due.

At 5.00am ET, a final report for the second quarter GDP is due from the Italian statistical office.

News are provided by InstaForex.

 

[IFX Darika]

Greenback Pares Recent Losses Monday Morning

The dollar was stable Monday morning in New York following last week's brutal losses, as traders geared up for a busy week on the economic front.

Increased risk aversion has driven the dollar to its lowest level of the year versus a basket of major currencies, but renewed concerns about the sustainability of the economic recovery could give the buck a boost in the coming days.

Monday's economic calendar is fairly light, with President Obama giving a speech on the economy and financial regulation in New York.

However, later in the week, traders will be flooded with a spate of economic data, which could help them gain more clarity on the economy's course.

The Commerce Department's retail sales report for August, the results of the New York Federal Reserve's and Philadelphia Federal Reserve's manufacturing surveys for September and the Federal Reserve's industrial production report for August may be closely watched.

The dollar rose sharply versus the sterling, jumping almost 2 cents to 1.6550 from a monthly low set late last week.

The buck also firmed up versus the euro, holding near 1.4550. Last week, the dollar hit a 2009 low of 1.4634 as stocks continued to improve.

The European Commission kept its economic outlook unchanged from May's spring forecast. Gross domestic product or GDP is expected to fall 4% this year in both the Eurozone and in the EU.

The dollar pared some of its recent losses versus the yen, improving to 90.90 from a February low of 90.18. With the advance, the dollar stayed away from a 13-year low of 87.08 set back in January.

Meanwhile, the buck hit a weekly high of C$1.0900 versus the loonie. Early in August, the dollar hit a yearly low of C$1.0630, but has since managed to stabilize.

News are provided by InstaForex.

 

[IFX Darika]

US Dollar Soars To New Multi-day Highs Against Majors

During early European deals on Monday, the US dollar rose to new multi-day highs against its major counterparts as a fall in most Asian and European stocks boosted demand for the safe haven greenback.

The dollar and the yen are viewed as safe-haven currencies and both currencies gain, when investors turn risk averse and fall when risk appetite improves.

Most of the stock markets were modestly lower today as investors look to this week's Federal Reserve meeting for more clues about the strength of the U.S. Recovery.

Early in Europe, Britain's FTSE 100 lost 0.4 percent, Germany's DAX fell 0.8 percent and France's CAC-40 dropped 0.3 percent.

In Hong Kong, the Hang Seng fell 150.60 points, or 0.7 percent, at 21,472.85 in back-and-forth trade, while South Korea's Kospi lost 0.3 percent to 1,695.50. China's Shanghai benchmark was up 0.2 percent at 2,967.01 and Australia's benchmark shed 0.3 percent.

Japanese financial markets are closed today for public holidays. Financial markets in India, Indonesia, Malaysia, Philippines and Singapore were also closed Monday for holidays.

World markets posted more gains last week as U.S. Federal Reserve Chairman Ben Bernanke said recession in the world's largest economy was "likely over."

This week, investors will watch closely what the Fed has to say about the economy and the scale of the recovery after a two-day meeting that wraps up Wednesday.

At its August meeting, the FOMC decided along the expected lines and maintained the fed funds futures rate unchanged. In its post-meeting policy statement, the Fed noted that economic activity is leveling out, an improvement from its previous opinion that the pace of contraction is slowing. There weren't any major changes to the references the committee made towards other measures.

Regarding its Treasury securities purchasing program, the central bank said the committee would gradually slow the pace of these transactions. The central bank anticipates the full amount of $300 billion to be purchased by the end of October. The FOMC reiterated its commitment to retain interest rates at exceptionally low levels for an extended period.

Against the European currency, the US dollar edged higher during early deals on Monday. At 2:35 am ET, the dollar reached a 6-day high of 1.4639 against the euro, compared to 1.4704 hit late New York Friday. The next upside target level for the dollar is seen around 1.437.

The US currency that closed Friday's North American session at 1.6246 against the British pound rose to a 19-day high of 1.6137 at 2:35 am ET Monday. The pound-dollar pair is currently trading at 1.6168 with 1.603 seen as the next target level.

British house prices increased in September on rising confidence and dwindling stock of property, results of a closely watched survey showed Monday.

Average asking prices were up 0.6% in September from August as autumn sellers raised price expectations, the property website Rightmove reported. House prices had declined 2.2% in August after rising 0.6% in July.

Meanwhile, the latest Quarterly Bulletin from the Bank of England showed today that sustainable rebalancing in the UK and the global economy depend on structural forces, including the extent to which consumers in deficit nations remain restrained and domestic demand in surplus countries pick up.

Against the Swiss franc, the greenback traded higher during Monday's early deals. At 5:15 am ET, the dollar-franc pair climbed to a 4-day high of 1.0357, compared to Friday's closing value of 1.0305. If the pair gains further, 1.055 is seen as the next target level.

The Swiss National Bank said today in a report that the M3 money supply increased 7.7% year-on-year in August, unchanged from the previous month. A year ago, the M3 money supply was up 2.5%. The M2 money supply climbed 41.8% on an annual basis in August, faster than the 41.3% growth in the previous month.

The dollar that closed Friday's New York deals at 91.46 against the Japanese yen advanced to 92.21 at 5:15 am ET. This set a 11-day high for the dollar. On the upside, 93.4 is seen as the next target level for the dollar-yen pair.

The Conference Board is scheduled to release a report on the U.S. leading index for August at 10 AM ET. The consensus estimate calls for a 0.7% increase in the leading indicators index for the month.

News are provided by InstaForex.

 

[IFX Darika]

Singapore Consumer Prices Fall Further In August

Singapore's consumer price index dropped 0.3% year-on-year in August, slower than than a 0.5% fall in the preceding month, a report by Statistics Singapore said Wednesday. Economists expected a 0.4% fall.

Housing costs fell 1.6%, due to lower electricity and gas tariffs and cheaper liquefied petroleum gas (LPG). Transport and communication costs fell 0.4%, mainly due to cheaper petrol prices. Excluding accommodation costs, the consumer price index declined 0.9%.

Month-on-month, consumer prices were up 0.4%, owing to higher costs of transport and communication, clothing and footwear, as also housing and stationery items. Excluding accommodation costs, consumer prices were up 0.5%. Meanwhile, after adjusting for seasonal effects, consumer prices were up 0.4% on a monthly basis in August.

In the first eight months, consumer prices rose 0.5% compared to last year.

News are provided by InstaForex.

 

[IFX Darika]

Malaysia Trying To Broaden Tax Base: PM

Tuesday, Malaysian Prime Minister Najib Razak said the government intends to reduce operating expenditure and to broaden its tax base. However, the reduction in expenditure would not affect the efficiency of the government, said Najib.

The government's pump priming measure is currently costing a billion ringgit a month. The government is set to present its 2010 budget next month.

Najib, who is also the finance minister, told reporters that the government is mindful of the need to rein in the fiscal deficit. The government expects the budget deficit to fall to 7.6% of GDP this year.

News are provided by InstaForex.