Rand edges weaker in tight range

JOHANNESBURG (Reuters) - South Africa's rand edged weaker on Tuesday but kept to a tight range and may still trend firmer on the back of solid global equities and positive emerging market sentiment, traders said.

The local currency was trading at 7.2160 to the dollar at 1520 GMT, almost 0.3 percent off its previous New York close of 7.1975 against the greenback. It ranged between 7.1888 and 7.2290 during the session.

Dealers said the rand was rangebound, taking its cue from other emerging markets, but appeared to be ignoring a stronger gold price.

"There is a slight bias to strengthen with emerging markets looking positive," a Johannesburg-based trader said, adding the rand was likely to drift between 7.18 and 7.23 to the dollar.

Some traders attributed initial rand strength to speculation that South Africa was in line for an imminent credit ratings upgrade.

IMF urges continued buildup of forex reserves

THE INTERNATIONAL Monetary Fund has urged the Bangko Sentral ng Pilipinas to further beef up its gross international reserves, now at a record high of $23.76 billion, while maintaining a flexible exchange rate policy.

In its 2006 country report, the IMF executive board said the BSP's current policy to deal with the upward pressure on the exchange rate was "broadly appropriate" but cited the merits of further building up the GIR while the foreign inflows were strong.

"Going forward, we urge continued exchange rate flexibility, even though further reserve accumulation might be justified given that the exchange rate does not appear to be mis-aligned," the IMF board said.

The peso is now trading at a six-year high against the US dollar. On Friday, the local currency peaked at 48.265 before closing at 48.305 to $1.

Currency Traders Pay Biggest Premium in 3 Years for Yen Calls

Currency traders are paying the most in almost three years for options that protect against a potential rebound in the yen versus the euro, before Group of Seven finance officials meet in Germany later this week.

Investors are hedging against the chance G-7 nations try to support the yen after it fell last month to a record low against the euro. German Finance Minister Peer Steinbrueck last week said the G-7 will discuss the drop in Japan's currency, which has weakened as the Bank of Japan kept its benchmark interest rate at 0.25 percent, the lowest among major economies.

Traders are buying insurance against an unraveling of the so-called carry trade, in which investors borrow in Japan and buy debt in economies such as the euro region, where they can get 2 percentage points or more in extra yield.

US Treasury secretary says Japan allows the yen's value to be set ...

Treasury Secretary Henry Paulson said Tuesday that he was not concerned about the lows being set by the Japanese currency against the U.S. dollar because those values are being set in open markets.

Paulson was pressed on the issue during congressional testimony by Rep. Sander Levin, who questioned why the Bush administration was not doing more to encourage the Japanese government to halt the slide in the yen against the dollar.

American automakers believe that decline has given their Japanese competitors a tremendous price advantage.

Levin, whose state has car manufacuting plantsd, said that European auto companies were complaining about the yen's decline against their currencies. He suggested that Paulson should join forces with European finance ministers to lobby Japanese officials on the issue when the countries meet for the Group of Seven finance ministers meeting in Essen, Germany this weekend.

Three Reasons Why Forex Trading is So Popular

There is a new type of short term trader whose ranks are growing by leaps and bounds. Forex trading is fast becoming many short term traders' preferred investment choice.

Port St. Lucie, FL (PRWeb) January 24, 2007 -- There is a new type of short term trader whose ranks are growing by leaps and bounds. Forex trading is fast becoming many short term traders' preferred investment choice.

Here are three reasons why forex trading is so popular:

First, it may be necessary to explain what forex trading is. Forex trading, also called currency trading, FX trading, Foreign Exchange trading and forex currency trading refers to the largest financial investment market in the world. Forex trading is fully electronic and has an average daily capital turnover amount in the area of $1.5 trillion.

World’s forex reserves to build our future

The World Bank is orchestrating a move to pool a portion of the burgeoning forex reserves of several developing countries, along with capital from some major economies, to create a new global bond fund for local currency debt. Indian finance minister P Chidambaram has been approached to co-chair the advisory board for the fund. Forex reserves of emerging markets like China and India are invested, for most part, in low-yield government securities of the US, Europe and Japan. Investing a portion of these in emerging markets is likely to push up the return on these reserves, even after factoring in the currency risk implicit in investing in emerging market bonds. Confirming the development, a World Bank spokesperson told ET: "The World Bank is in the process of considering the promotion of a global investment vehicle which could help further develop the emerging markets' local currency bond markets.

China to set up firm for managing forex reserves

BEIJING: China plans a special firm to manage one fifth of its forex reserves, laying the foundations of a behemoth that will handle more money than the biggest mutual fund in the world, state media said on Friday. The State Foreign Exchange Investment Company is expected to be in charge of $210 billion, or more than the Growth Fund of Americas approximately $160 billion of assets, according to the reports. The State Council proposed at the national finance work conference (last month) to set up a special forex investment institution, an official with Central Huijin Investment Co, a government investment arm, told AFP. The State Foreign Exchange Investment Company will get its $210 billion as part of a plan to divide Chinas $1.07 trillion of reserves into three portions, the Southern Weekly paper said, giving no sources.

Three Reasons Why Forex Trading is So Popular

There is a new type of short term trader whose ranks are growing by leaps and bounds. Forex trading is fast becoming many short term traders' preferred investment choice.
Port St. Lucie, FL (PRWeb) January 24, 2007 -- There is a new type of short term trader whose ranks are growing by leaps and bounds. Forex trading is fast becoming many short term traders' preferred investment choice. Here are three reasons why forex trading is so popular: First, it may be necessary to explain what forex trading is. Forex trading, also called currency trading, FX trading, Foreign Exchange trading and forex currency trading refers to the largest financial investment market in the world. Forex trading is fully electronic and has an average daily capital turnover amount in the area of $1.5 trillion.

New Exchange Traded Funds (ETFs) On The SWX Swiss Exchange

Five new products have been listed in the Exchange Traded Funds segment of the SWX Swiss Exchange, taking the total to 66 ETFs. The new funds are:
Lyxor ETF Dax. The trading currency is EUR. Lyxor ETF MSCI India. The trading currency is USD. Lyxor ETF MSCI USA. The trading currency is USD. Lyxor ETF MSCI World. The trading currency is USD. Lyxor ETF Japan (TOPIX). The trading currency is JPY.
Socit Gnrale has signed a market-making agreement with SWX and will be responsible for ensuring liquidity in these securities.
SWX Swiss Exchange The SWX Swiss Exchange, a part of the SWX Group, is one of the world's leading and most technologically advanced securities exchanges. The fully automated trading, clearing and settlement system remains unique in the world.

FXDD Launches Automated Currency Trading Platform

FXDD, a global leader in online foreign currency exchange, is pleased to announce the launch of FXDDAuto, an automated currency trading platform based on Tradency's forex platform. The exclusive venture between FXDD and Tradency brings together cutting-edge technology, proprietary access and a global support network. FXDDAuto allows forex traders to streamline their efforts, adjust strategies and design and test portfolios using real-time and historical data without incurring prepaid subscription fees or requiring complex programming. This customized perspective greatly enhances a trader's ability to manage and assess the risk in their portfolios and to make changes as the market demands. FXDDAuto's basket of over 50 systems and signals adds a powerful new dimension to online forex trading.

DJ Forex Focus: Yen Carry Trades Likely To Resume

Trading in the Japanese currency may prove a little more choppy than it was before - given continued background concerns about the meeting of the Group of Seven leading industrial nations in Essen, Germany, Feb. 9-10 - and losses may not be so heavy against the Australian and New Zealand dollars this time around, but against the dollar and the euro there is little reason to see much change. "We are not reducing our long dollar/yen and euro/yen positions ahead of the G7 meeting," said Monica Fan, head of global foreign-exchange strategy at RBC Capital Markets in London. Concern that G7 finance ministers and central bankers might take some coordinated action to stop the yen's decline had helped to discourage carry trades over the last week or so as European officials complained about the economic risks posed by the yen's decline against the euro.

Yen slides, market sees few surprises from G7

TOKYO -- The yen closed in on a four-year low against the dollar and a record trough versus the euro on Friday before a Group of Seven finance ministers' meeting that is unlikely to seriously tackle the yen's weakness, investors said.
The euro also drew support from comments from ECB President Jean-Claude Trichet, who signaled on Thursday that rates could rise in March and possibly later on in the year. The ECB left rates unchanged at 3.5 percent in the previous session.
Market focus is on the statement that will follow the two-day G7 gathering, which starts in Essen, Germany, later in the day.
Some investors were also selling the yen ahead of a market holiday in Japan on Monday.
"The market is betting that the yen won't be included in the communique, which is why we're seeing buying in currencies against the yen," said a forex trader at a European investment bank.

As Assets Dip, Forex Holds

In his recent New York Times article, "It's the Year to Keep an Eye on Paychecks," author David Leonhardt points to the uncertain financial future which Americans face in 2007. Pay rates, he argues, may be on the rise, but very little is certain as far as housing rates and the stock market are concerned. Surprised? You shouldn't be. When it comes to personal investments, real estate and stock always cycle, and opportunities come and go. Annual assurance of opportunity can never be guaranteed. By sharp contrast, Titan Commodities Management, Ltd. (http://titancm.com) offers investors an environment where safety and a worthwhile return on investment are an annual reality, despite the ebb and flow of traditional market products."What makes us unique, in comparison with other financial managers, is that we put our client's money first.

Get a fix on use of forex, first

The need for massive investments -- $320 billion, or more over the next five years -- in infrastructure to support the 8-10% growth envisaged for the economy is no longer a matter of debate. If we assume that all our public agencies are able to quickly prepare properly structured and designed infrastructure investments of this magnitude (and that is indeed a big assumption, as the capacity required to prepare many projects -- particularly of the PPP type -- is indeed a major constraint within the public sector), one of the big concerns is the ability to finance such massive investment.
The massive financing of infrastructure projects assumes an extra dimension since a significant part of it (perhaps $75-100 billion) is to be executed through public partnerships. Even in public investment projects, financing issues need to be critically examined as the government has accepted a fiscal responsibility framework.

State Street buys online forex trading platform

State Street, one of the world's largest financial services groups, has stepped-up its efforts to attract more business from hedge funds and other active traders by buying Currenex, an online foreign exchange trading platform, for $564m in cash.
Currenex provides electronic currency trading primarily for the rapidly growing $1,300bn hedge fund industry where State Street, which is primarily known for its money management and custody businesses, has been trying to boost its presence.
"This acquisition diversifies State Street's trading customer base beyond traditional asset managers to include more active currency managers and hedge funds," said Joseph Hooley, vice-chairman.
State Street, which has $1,700bn in assets under management and $11,900bn in assets under custody, said Currenex would augment its FX Connect foreign exchange trading platform, which last month topped $108bn of trading volume in one day.

Malaysian currency soars to new high against greenback

Malaysian currency on Wednesday continued the upward momentum against the greenback, further breaking the nine-year high set on Tuesday.
It closed at 3.4930/4940 against the U.S. dollars on Wednesday, jumping from the 3.4955/4980 in the previous day. The ringgit on Tuesday breached the 3.50 barrier, the highest record since the early 1998.
Local media reports said strong foreign fund flows into the stock market and friendly comments from the central bank supported the further strengthening of the local currency.
Malaysia pegged the ringgit against the U.S. dollar at 3.80 since 1998. Beginning from July 2005, it was de-pegged and floated against a basket of currencies. It has appreciated gradually since then.
Local think tank Asian Strategy and Leadership Institute (ASLI) said the currency is expected to further appreciate with the ringgit at 3.4 against the U.S.

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Daily FX Commentary

The decision to leave interest rates at 0.25% will maintain the risk of yen selling on yield grounds. There will be the risk of yen losses towards 122.0 in the short term before a potentially sharp correction.
The yen weakened to lows around 120.85 against the dollar on Wednesday before regaining some ground later in US trading ahead of the Bank of Japan decision. The yen came under fresh pressure after the Bank of Japan interest rate decision with a move beyond 121.0.
The Bank of Japan left interest rates at 0.25% following the latest policy meeting. There was, however, a split decision with a 6-3 vote for unchanged rates, the tightest vote for three years. There will be a strong suspicion that the bank bowed to political pressure in the decision to leave rates on hold and this will undermine Bank of Japan credibility.

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Forex Training Available for Forex Traders

FXstreet.com and FxBootcamp.com welcomed TradeTheNews.com to their partnership of providing online educational events for Foreign Currency (Forex, FX or 4X) Traders featuring live news, analysis and Forex training. Belmont, CA, USA, January 31, 2007 -- Trade The News brings live audio news feed to the already successful online events. Forex Traders attending the event will hear the news instantly, usually before the TV networks even have time to react. The Non-Farm Payrolls Employment Report, issued by the U.S. Department of Labor the first Friday of each Month, is the best measure of the health of the U.S. Economy and therefore directly impacts the value of the U.S. Dollar, often dramatically. "As the largest Forex Portal on the web, we are in touch with what currency trades need," says Francesc Riverola, CEO of FXstreet.com.

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Informed Forex launches free learning community

InformedForex.com has just launched a free community filled with freely distributed articles and videos organized to help traders find the information they need to learn how to trade the forex market. The community offers the following features: Free blogs that members can use as trading journals and as a platform to interact with other traders Articles and discussion forums to help traders learn what they need to know News articles to help traders stay abreast of the most important news happening in the forex market The community aims to provide forex traders, both experienced and novice, with a portal they can use to navigate the web of forex information on the Internet as well as have conversations with other forex traders in a neutral environment.

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DJ Forex Focus: Yen Carry Trades Likely to Resume

Trading in the Japanese currency may prove a little more choppy than it was before - given continued background concerns about the meeting of the Group of Seven leading industrial nations in Essen, Germany, Feb. 9-10 - and losses may not be so heavy against the Australian and New Zealand dollars this time around, but against the dollar and the euro there is little reason to see much change. "We are not reducing our long dollar/yen and euro/yen positions ahead of the G7 meeting," said Monica Fan, head of global foreign-exchange strategy at RBC Capital Markets in London. Concern that G7 finance ministers and central bankers might take some coordinated action to stop the yen's decline had helped to discourage carry trades over the last week or so as European officials complained about the economic risks posed by the yen's decline against the euro.

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