GCC states — Bahrain, Kuwait and Saudi Arabia — decided to cut their deposit rates from 3.50% to 3.00% today, following the yesterday’s interest rate cut by the Federal Reserve.
The Central Bank of the Russian Federation will probably stop intervening into the national currency market in order to strengthen the ruble against the U.S. dollar and hold down the growing inflation.
The majority of Forex traders expected that the Reserve Bank of India will lower the main interest rates today to pare with recent emergency cut by the Fed and the anticipated additional interest cut at tomorrow Fed’s meeting. But Yaga Venugopal Reddy, Governor of the Reserve Bank of India, decided to leave the key interest rates at the same level.
The Singapore dollar rose today during the Asian Forex trading session as the market analysts expected the Federal Reserve of U.S. to lower the interest rate at the next meeting, widening the rates difference for these two currencies.
The government of Dubai, U.A.E. largest emirate, is against the currency revaluation and is pro dirham’s peg to the U.S. dollar, according to Sultan Ahmed bin Sulayem, the member of the Dubai’s Board of Executive Council.
Palaniappan Chidambaram, the Finance Minister of India, said yesterday that the latest emergency rate cut by the Fed will probably influence the next interest rate decision by the Reserve Bank of India.
With almost every day on Forex being bullish for the Chinese yuan, today it continued its appreciation against other major currencies and particularly against the U.S. dollar, which is now in a bearish trend after the latest Fed’s rate cut.
Euro stood stronger against the U.S. dollar and the Japanese yen on Forex market after the Business Climate Index for January 2008 in Germany was released by the Ifo Institute for Economic Research today.
The Australian dollar gained yesterday after the Federal Reserve announced an emergency rate cut from 4.25% to 3.50%. It also continued to gain today through the most of the Asian trading session, but has already went down past the daily opening price.
Today, the Federal Reserve System decreased the national benchmark interest rate by 0.75% — from 4.25% down to 3.50%. This was an emergent move to stimulate the financial liquidity amidst the tumbling stock markets.