Asian holdings of foreign exchange reserves, excluding those of China's, shrank $119 billion in October, central bank data showed, as the authorities tried to defend their currencies amid an emerging market rout.
The decline was led by a $38.9-billion plunge in India's holdings and a drop of $27.4 billion in South Korea's.
Foreign investors have sold $63 billion worth of shares in Asia ex-Japan so far this year, led by the sale of $33 billion in South Korea, nearly $14 billion in Taiwan and almost $12 billion in India, according to Nomura.
That weighed on Asian currencies, led by the South Korean's won's 30-percent fall against the dollar this year.
"The market volatility came through in October, which led to a significant drawing down in foreign exchange reserves in a number of countries," said Nicholas Bibby, senior regional economist at Barclays Capital.
"Because of deleveraging by global banks, certainly in the case of South Korea we saw the Bank of Korea becoming much more active in stepping in and provide liquidity to the market," he said.
South Korean authorities injected at least $12.7 billion in October to ease a dollar crunch in the domestic money market.
Asia's overall holdings of foreign exchange reserves, including China's holdings until September, reached $4.2 trillion last month, still up 8.0 percent from the end of 2007, data showed.
But Pakistan's reserves plunged 57 percent during the period, followed by a 23-percent drop in South Korea's holdings.
China, holder of the world's largest reserves, releases data at the end of every quarter.
Analysts expect the rise in China's reserves, which swelled by $96.8 billion in the third quarter to a record $1.9 trillion, would slow as exports and capital inflows lose steam.
Saturday, November 29, 2008
UAE is the best performing country for forex trading
Trading in foreign exchange, which saw global daily volumes of more than $3 trillion (Dh11trn) last year, has been drawing interest from investors across the world.
Estimated to be 20 times higher than the daily volume of the New York Stock Exchange, providers of online forex trading platform are quite buoyant on the growth of this asset class in spite of the global economic crisis.
Betsy Waters, Global Director, dbFX, an online margin foreign exchange trading platform launched by Deutsche BankDeutsche BankLoading..., says forex trading is in for massive growth. Excerpts from an interview.
Estimated to be 20 times higher than the daily volume of the New York Stock Exchange, providers of online forex trading platform are quite buoyant on the growth of this asset class in spite of the global economic crisis.
Betsy Waters, Global Director, dbFX, an online margin foreign exchange trading platform launched by Deutsche BankDeutsche BankLoading..., says forex trading is in for massive growth. Excerpts from an interview.
Australian Dollar to Rise As Capital Flows Back to Risky Assets
The Australian Dollar faces a busy economic calendar next week, but forex traders are unlikely to see anything that would substantially alter the prevailing fundamental outlook.
The Reserve Bank of Australia’s Quarterly Monetary Policy Statement is likely to offer familiar rhetoric justifying further reduction of borrowing costs. The markets are sure to take this in stride, with overnight index swaps already pricing in an additional 125-150 basis points in rate cuts over the next 12 months.
On balance, the Australian Dollar looks assertive for abbreviate appellation sentiment-driven assets adjoin its US counterpart. As acclaim bazaar altitude accept started to normalize, investors accept amorphous to carefully move basic out of safe-haven assets (i.e. the greenback) and aback into equities. This has produced an impressively able changed alternation amid the US dollar and the MSCI Apple Stock Index. A retracement in USD-based pairs is accordingly acceptable as the excesses of the acclaim crisis agitation are adapted afore the broader trend resumes.
Last week saw AUDUSD break above near-term resistance, with bullish follow-through likely to see the pair test Fibonacci resistance at 0.7262.
The Reserve Bank of Australia’s Quarterly Monetary Policy Statement is likely to offer familiar rhetoric justifying further reduction of borrowing costs. The markets are sure to take this in stride, with overnight index swaps already pricing in an additional 125-150 basis points in rate cuts over the next 12 months.
On balance, the Australian Dollar looks assertive for abbreviate appellation sentiment-driven assets adjoin its US counterpart. As acclaim bazaar altitude accept started to normalize, investors accept amorphous to carefully move basic out of safe-haven assets (i.e. the greenback) and aback into equities. This has produced an impressively able changed alternation amid the US dollar and the MSCI Apple Stock Index. A retracement in USD-based pairs is accordingly acceptable as the excesses of the acclaim crisis agitation are adapted afore the broader trend resumes.
Last week saw AUDUSD break above near-term resistance, with bullish follow-through likely to see the pair test Fibonacci resistance at 0.7262.
SBI, ICICI say they have enough forex liquidity
India's leading lenders, State Bank of India and ICICI Bank, on Saturday said they may not use the special dollar window announced by the Reserve Bank on Friday, as they had enough forex liquidity.
"As far as the forex liquidity is concerned, we are positive...We are actually placing money on an overnight basis...And as far as our dollar balance-sheet is concerned, we are quite well-matched...So we may not need it (to use the RBI window allowed yesterday)," SBI's Chairman, O P Bhatt, told reporters on the sidelines of a FICCI-IBA organised seminar in Mumbai.
With a view to provide sufficient dollar liquidity to banks, RBI had on Friday announced a special window using which banks could borrow dollar funds through forex swaps.
While there is sufficient short-term liquidity in the system, banks will have to ensure availability of medium to long-term liquidity, Bhatt said.
ICICI Bank's Joint Managing Director, Chanda Kochhar, said the special window opened by the RBI was a welcome step and would help to improve the foreign currency shortage in the banking system.
"As far as the forex liquidity is concerned, we are positive...We are actually placing money on an overnight basis...And as far as our dollar balance-sheet is concerned, we are quite well-matched...So we may not need it (to use the RBI window allowed yesterday)," SBI's Chairman, O P Bhatt, told reporters on the sidelines of a FICCI-IBA organised seminar in Mumbai.
With a view to provide sufficient dollar liquidity to banks, RBI had on Friday announced a special window using which banks could borrow dollar funds through forex swaps.
While there is sufficient short-term liquidity in the system, banks will have to ensure availability of medium to long-term liquidity, Bhatt said.
ICICI Bank's Joint Managing Director, Chanda Kochhar, said the special window opened by the RBI was a welcome step and would help to improve the foreign currency shortage in the banking system.
Ringgit Expected To See Volatile Trading
The ringgit is expected to see volatile trading against the US dollar next week on concern over the sharp global economic downturn, dealers said.
According to them, the current situation is encouraging investors to seek safe-haven assets and lower-yielding currencies.
On a Friday-to-Friday basis, the ringgit was lower adjoin the US dollar at 3.5500/5540 compared with endure Friday's closing of 3.5460/5510.
Against the Singapore dollar, the bounded assemblage was firmer at 2.3759/3806 from 2.3890/3945 endure Friday and it aswell adequate adjoin the Japanese yen at 3.6455/6507 from 3.6594/6665 previously.
The ringgit about attenuated adjoin the euro at 4.5515/5576 from 4.5058/5135 endure Friday but it was college adjoin the British batter at 5.5856/5936 from 5.7587/7686 previously.
According to them, the current situation is encouraging investors to seek safe-haven assets and lower-yielding currencies.
On a Friday-to-Friday basis, the ringgit was lower adjoin the US dollar at 3.5500/5540 compared with endure Friday's closing of 3.5460/5510.
Against the Singapore dollar, the bounded assemblage was firmer at 2.3759/3806 from 2.3890/3945 endure Friday and it aswell adequate adjoin the Japanese yen at 3.6455/6507 from 3.6594/6665 previously.
The ringgit about attenuated adjoin the euro at 4.5515/5576 from 4.5058/5135 endure Friday but it was college adjoin the British batter at 5.5856/5936 from 5.7587/7686 previously.
CMS Forex Launches Forex Platform
CMS Forex, an online provider of Forex trading casework for retail audience and institutional brokers, is absolution their new platform, VT Trader 2.0. VT Trader has undergone a complete makeover and comes able with cogent enhancements both in account and performance. The new clear interface sports ample icon-based buttons for simple aeronautics and a activating new Quotes Board, which provides greater afterimage of bazaar movement and lets traders abode bazaar orders, set stops and limits, and amount alerts with the bang of the mouse.
The accomplishing of the new docking, tabbing, and "auto hide" functions aerate ability of space, acceptance traders to adept their trading workspace and save assorted layouts and environments.
In addition, VT Trader has broadcast on its already acceptable armory of analytic tools, which includes Blueprint Arrangement Acceptance Technology, with Traders Guardian, a accumulating of accoutrement which advice traders barometer and assay their accident levels.
Fundamental and abstruse traders will adore the account of absolute admission to Dow Jones FX Select, a reside newsfeed that provides audience with real-time market-moving account that includes bread-and-butter indicators and Dow Jones columns and rolling bazaar annotation such as Dow Jones FX MarketTalk.
VT Trader's adjustment processing technology has aswell been thoroughly adapted and now includes a self-monitoring arrangement to ahead and anticipate inefficiencies. As a result, traders will acquaintance faster amount feeds and quicker beheading of trades.
The accomplishing of the new docking, tabbing, and "auto hide" functions aerate ability of space, acceptance traders to adept their trading workspace and save assorted layouts and environments.
In addition, VT Trader has broadcast on its already acceptable armory of analytic tools, which includes Blueprint Arrangement Acceptance Technology, with Traders Guardian, a accumulating of accoutrement which advice traders barometer and assay their accident levels.
Fundamental and abstruse traders will adore the account of absolute admission to Dow Jones FX Select, a reside newsfeed that provides audience with real-time market-moving account that includes bread-and-butter indicators and Dow Jones columns and rolling bazaar annotation such as Dow Jones FX MarketTalk.
VT Trader's adjustment processing technology has aswell been thoroughly adapted and now includes a self-monitoring arrangement to ahead and anticipate inefficiencies. As a result, traders will acquaintance faster amount feeds and quicker beheading of trades.
Sunday, November 9, 2008
RBI to provide forex swap facility to banks
The Reserve Bank of India (RBI) will provide foreign exchange liquidity to foreign branches and subsidiaries of Indian banks through currency swaps.
The central bank said today the move would provide flexibility to Indian banks in managing their short-term requirements at their overseas offices in the context of the global credit crisis.
RBI will activity bill swaps crumbling in up to three months. The swaps will be priced application calm and beyond money-market ante and the dollar-rupee advertence amount appear circadian by the axial bank.
RBI said axial banks beyond the apple accept taken activity to affluence the clamminess bearings through measures such as inter-central coffer bandy lines, collateralized lending and forex swaps, in acknowledgment to the advance contest apropos to the all-around agitation and its appulse on all-embracing money markets.
Explaining the implications of the decision, a State Coffer of India official said those who are not able to get acclaim from adopted banks can now tap the RBI window. This will advice Indian banks with beyond attendance to advance over the clamminess crisis. The official, however, said SBI is not adverse any problems as it has surplus dollars.
Apart from SBI, the added banks, which accept a abundant beyond attendance are Coffer of Baroda, Coffer of India, ICICI Coffer and Axis Bank.
Due to the banking crisis, Indian banks accept afflicted their business strategies for beyond branches to assure them from any downside risks. In some cases, they accept purchased dollars in the calm bazaar and beatific them to their beyond branches to accommodated business requirements.
The central bank said today the move would provide flexibility to Indian banks in managing their short-term requirements at their overseas offices in the context of the global credit crisis.
RBI will activity bill swaps crumbling in up to three months. The swaps will be priced application calm and beyond money-market ante and the dollar-rupee advertence amount appear circadian by the axial bank.
RBI said axial banks beyond the apple accept taken activity to affluence the clamminess bearings through measures such as inter-central coffer bandy lines, collateralized lending and forex swaps, in acknowledgment to the advance contest apropos to the all-around agitation and its appulse on all-embracing money markets.
Explaining the implications of the decision, a State Coffer of India official said those who are not able to get acclaim from adopted banks can now tap the RBI window. This will advice Indian banks with beyond attendance to advance over the clamminess crisis. The official, however, said SBI is not adverse any problems as it has surplus dollars.
Apart from SBI, the added banks, which accept a abundant beyond attendance are Coffer of Baroda, Coffer of India, ICICI Coffer and Axis Bank.
Due to the banking crisis, Indian banks accept afflicted their business strategies for beyond branches to assure them from any downside risks. In some cases, they accept purchased dollars in the calm bazaar and beatific them to their beyond branches to accommodated business requirements.
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