Another carry trade crisis victim - South African rand saw its bad times during the past week. ZAR closed on its lowest rate against Japanese yen (which can be easily called the “favorite” of the week) since the mid September - 15.8549 yens per rand.
Indian currency ended at its lowest rate against U.S. dollar on Friday, being on its weakest since October 23. USD/INR closed on 39.71 level yesterday, after international investors and global corporations were moving out their funds out of Indian currency.
Hamud Bin Sangur al-Zadjali, the Central Bank of Oman Governor, spoke during European Banking Congress in Frankfurt today, speaking that Oman has no plans to end its peg to U.S. dollar.
Jim Flaherty, Canadian Minister of Finance, said today that he is glad to see Canadian dollar losing against U.S. dollar on Forex, after there were almost three month of unstoppable appreciation of the Canada’s currency. As the rallying Canadian dollar’s appreciation hurts exporters, Canada’s economy could be at the risk, giving government another concern to worry about.
Dollar slid to its new historical bottom rate against euro hitting 1.4967 on EUR/USD. Missing the marvelous 1.5000 pint by about 30 pips, EUR/USD retraced by 150 points back as the Forex traders consolidated their profits on the rally. Another week without any supporting for dollar may probably break this resistance.
Yesterday Canadian dollar reached its monthly minimum levels after the macroeconomic statistics were released by Canada’s National Statistics Agency. September 2007 retails sales fell by 0.2 percents compared to previous month. USD/CAD traded at 0.9923 on Forex as the data was released.
Minutes of the last (7 and 8 November) Bank of England Monetary Policy Committee were released today, showing the vision for the U.K. economy by the committee members. As the interest rates decision was known by the traders already - BoE left rates unchanged at 5.75%, the major interest was drawn to the exact voting details.
Federal Reserve’s FOMC published its first meeting minutes to include the 3-year projections of the committee members regarding the GDP growth, consumer prices inflation and unemployment rate. While the average projection expectations didn’t differ greatly (except for the year 2008) from this year’s results, the uncertainty of the inflation projections spoke for itself - Fed is unsure of the impact the interest rates manipulations will have on the consumer prices growth.
Chinese yuan gained against dollar during today’s trading session in Shanghai, reaching 7.425 yuan/dollar rate. This appreciation of yuan was caused mainly by the falling U.S. dollar against euro, pound and other currencies.
Japanese yen restarted its falling against other world currencies today (even against the dropping dollar) as the risk hungry investors begin to reenter carry trades. While the Nikkei 225 index gained a little more than 1 percent - first rising day after four consecutive losing days, Yen lost more than 1 percent of its value to the high-yielding currencies.
