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Google, Oracle Urge U.S. to Oppose Chinese Censorship (Update1)
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By Mark Drajem and Todd Shields
June 12 (Bloomberg) -- A group representing computer and software companies including Google Inc. and Oracle Corp. petitioned the U.S. government to add the topic of online censorship to a trade summit with China, the world's biggest Internet market.
If the Obama administration acts on the industry petition, it may be the first time China's censorship policies would be discussed as part of trade negotiations between the nations.
"By engaging in Internet censorship, the Chinese government is creating a hostile market environment and preventing its citizens from fully utilizing new products and services provided by U.S. high-tech companies," the Computer & Communications Industry Association said in the petition today.
The industry group also criticized plans by China to require all personal computers, or PCs, to include software to block Internet pornography and other "unhealthy" content.
"If imported PCs are required to preinstall censorship software that some believe may cause operational problems for the PCs, that could constitute discriminatory treatment," the group said in the filing.
The association asked the U.S. Trade Representative's office to press China on these restrictions during this year's annual Joint Commission on Commerce and Trade summit. In previous years the U.S. and China have negotiated subsidies to the steel industry, China's non-market economy status in the U.S., curbs on U.S. meat exports to China and the piracy of copyrighted and patented goods in China.
Trade Tensions
The request from the group, which also represents Microsoft Corp. and Yahoo Inc. shows how trade tensions between the U.S. and China may grow as their commercial relations broaden and the effects of the global economic recession linger.
China ran up a record $266 billion trade surplus with the U.S. last year, and has passed Canada to become the largest single source of imports into the U.S. That trade gap has prompted complaints from Democratic lawmakers, unions and small manufacturers that Chinese products are benefiting from unfair subsidies, an undervalued currency and low-cost bank loans.
NOTE: that trade gap has prompted complaints from decromatic lawmarkers.
Technology companies want a dialogue about the restrictions the Chinese government imposes on Internet use.
Twitter Inc.'s social-networking service and Microsoft's Bing.com search engine were inaccessible in China in the week preceding June 4, the 20th anniversary of the Tiananmen Square crackdown on pro-democracy demonstrators. China ranks first worldwide in online censorship, according to Herdict.org, a project of the Berkman Center at Harvard, which compiles reports of Web outages.
To contact the reporter on this story: Mark Drajem in Washington at mdrajem@bloomberg.net; Todd Shields in Washington at tshields3@bloomberg.net.
Last Updated: June 12, 2009 14:09 EDT
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AUTRALIA DOLLAR UP LATE, SPURRED ON BY BETTER ECON DATA
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* JUNE 12, 2009, 2:49 A.M. ET
Australia Dollar Up Late, Spurred On By Better Econ Data
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Rates At 0625 GMT
Latest Change
AUD/USD 0.8146 +0.5%
AUD/JPY 79.88 +0.6%
5.75% Apr, 2012 4.455% -0.062
5.25% Mar, 2019 5.555% -0.047
10-Yr Spread To U.S. +187 bps +7 bps
SFE Jun 3-Year Futures 95.59 +0.08
SFE Jun 10-Year Futures 94.465 +0.055
SYDNEY (Dow Jones)--The Australian dollar was stronger but off its heady peak late Friday as a confidence-driven run up in risk appetite was tempered by some profit taking.
Economic data, both domestic and offshore, have been broadly supportive of the Australian dollar this week.
In the offshore session, U.S. jobless claims fell while an advanced reading of retail sales showed strength in the U.S. sector, shoring up expectations about a recovery in global economic growth.
At 0625 GMT, the Australian dollar was quoted at US$0.8146 from US$0.8106 late Thursday. It hit a peak of US$0.8235 in the offshore session. Against the Japanese yen, it was at Y79.88 from Y79.42.
RBC Capital Markets Senior Currency Strategist Sue Trinh said a number of large trades in the Asian session have checked the advance of the high-yielding currencies.
"Kiwi and Aussie are the underperformers after being the outperformers yesterday," Trinh said.
She said the currency has struggled to hold above the psychologically important US$0.8200 mark.
The break of US$0.8170 in the Asian session suggests it could drop back down toward US$0.8000 in European and U.S. trade, Trinh said.
A potential driver for currency markets remains the Group of Eight summit in Italy this weekend.
Market participants are tuned in for any comments from policy makers at the summit about the recent weakness of the U.S. dollar.
"There's always speculation that these officials are going to try and talk the U.S. dollar higher because they don't like their own currencies being too strong but I'm doubtful they will," Trinh said.
Westpac strategists said news that the Commonwealth Bank of Australia has lifted its standard variable rate by 10 basis points on the back of higher funding costs weighed on the currency slightly.
"This has seen market interest rates fall as the market speculates whether this will prompt further Reserve Bank of Australia interest rate cuts," Westpac said.
Meanwhile, Australian bond futures have clawed back some of their losses from Thursday's trade with the three- to 10-year bond yield spread steepening slightly again to 112.5 basis points.
Commonwealth Bank of Australia Debt Strategist Jarrod Kerr said bond futures have tracked a rebound in U.S. Treasurys, which have been sought after yields hit fresh highs, making them particularly attractive for bargain-hunting investors.
NOTE: the australia bond in a future that have clawed back some of their losses from thur's day.
But he expects the three- to 10-year yield spread will widen again and suggests entering steepener trades if the spread falls back below 110 basis points.
June three-year bond futures rose eight ticks to 95.59 while 10-year futures rose 5.5 ticks to 94.465.
"I think the selloff in the front end has been a little too aggressive," Kerr said.
"Even though we've got a much more upbeat central bank governor and we will see more talk on how Australia's likely to outperform, I don't think the Reserve Bank of Australia is going to deliver on the rates hikes the market is pricing in over the next year."
-By Sam Holmes, Dow Jones Newswires;
61-2-8272-4686; samuel.holmes@dowjones.com
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(Data provided by Reuters)
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* JUNE 12, 2009, 2:49 A.M. ET
Australia Dollar Up Late, Spurred On By Better Econ Data
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Rates At 0625 GMT
Latest Change
AUD/USD 0.8146 +0.5%
AUD/JPY 79.88 +0.6%
5.75% Apr, 2012 4.455% -0.062
5.25% Mar, 2019 5.555% -0.047
10-Yr Spread To U.S. +187 bps +7 bps
SFE Jun 3-Year Futures 95.59 +0.08
SFE Jun 10-Year Futures 94.465 +0.055
SYDNEY (Dow Jones)--The Australian dollar was stronger but off its heady peak late Friday as a confidence-driven run up in risk appetite was tempered by some profit taking.
Economic data, both domestic and offshore, have been broadly supportive of the Australian dollar this week.
In the offshore session, U.S. jobless claims fell while an advanced reading of retail sales showed strength in the U.S. sector, shoring up expectations about a recovery in global economic growth.
At 0625 GMT, the Australian dollar was quoted at US$0.8146 from US$0.8106 late Thursday. It hit a peak of US$0.8235 in the offshore session. Against the Japanese yen, it was at Y79.88 from Y79.42.
RBC Capital Markets Senior Currency Strategist Sue Trinh said a number of large trades in the Asian session have checked the advance of the high-yielding currencies.
"Kiwi and Aussie are the underperformers after being the outperformers yesterday," Trinh said.
She said the currency has struggled to hold above the psychologically important US$0.8200 mark.
The break of US$0.8170 in the Asian session suggests it could drop back down toward US$0.8000 in European and U.S. trade, Trinh said.
A potential driver for currency markets remains the Group of Eight summit in Italy this weekend.
Market participants are tuned in for any comments from policy makers at the summit about the recent weakness of the U.S. dollar.
"There's always speculation that these officials are going to try and talk the U.S. dollar higher because they don't like their own currencies being too strong but I'm doubtful they will," Trinh said.
Westpac strategists said news that the Commonwealth Bank of Australia has lifted its standard variable rate by 10 basis points on the back of higher funding costs weighed on the currency slightly.
"This has seen market interest rates fall as the market speculates whether this will prompt further Reserve Bank of Australia interest rate cuts," Westpac said.
Meanwhile, Australian bond futures have clawed back some of their losses from Thursday's trade with the three- to 10-year bond yield spread steepening slightly again to 112.5 basis points.
Commonwealth Bank of Australia Debt Strategist Jarrod Kerr said bond futures have tracked a rebound in U.S. Treasurys, which have been sought after yields hit fresh highs, making them particularly attractive for bargain-hunting investors.
NOTE: the australia bond in a future that have clawed back some of their losses from thur's day.
But he expects the three- to 10-year yield spread will widen again and suggests entering steepener trades if the spread falls back below 110 basis points.
June three-year bond futures rose eight ticks to 95.59 while 10-year futures rose 5.5 ticks to 94.465.
"I think the selloff in the front end has been a little too aggressive," Kerr said.
"Even though we've got a much more upbeat central bank governor and we will see more talk on how Australia's likely to outperform, I don't think the Reserve Bank of Australia is going to deliver on the rates hikes the market is pricing in over the next year."
-By Sam Holmes, Dow Jones Newswires;
61-2-8272-4686; samuel.holmes@dowjones.com
-
(Data provided by Reuters)
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* [WK-AQ118_tourju_C_20090610161735.jpg]
My Summer Music Tour
* [WK-AQ089_COVER__C_20090610151359.jpg]
Central Park Zoo Welcomes New Snow Leopards
* [0610bags04]
A New Look at the Bag Scourge
* [Fifth-graders learn about healthy eating habits. While some diseaseprevention programs work, others aren't cost-effective, studies find.]
Disease Prevention Provides No Cure-All
* [ronaldo contract and manchester united and real madrid]
Manchester United Accepts Ronaldo Bid
* [sri lanka police security]
Sri Lanka Begins Painful Reconciliation
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Temblors Rattle Texas Town
* [Russian Prime Minister Vladimir Putin attends a meeting with Cabinet officials in Moscow on May 25.]
Russians Outfox U.S. in Latest Great Game
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Shaking the Hand That Defeats You
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Iranian Contenders Court Women Voters
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Big Legacy for Dave Matthews Band
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Strip Clubs Pare Upscale Offerings
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Thursday, July 9, 2009
U,S STOCKS DECLINE MODESTLY ON STRONG DOLLAR , WEAK COMMODITIES
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* JUNE 12, 2009, 11:32 A.M. ET
US Stocks Decline Modestly On Strong Dollar, Weak Commodities
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By Peter A. McKay
Investors' simmering concerns about the U.S. government's finances led Friday to a stronger dollar, weaker commodity prices, and a modest stock-market slide.
The Dow Jones Industrial Average was down 11 points in recent trading. The Nasdaq Composite Index was recently off 1.2%. The S&P 500 fell 0.5%, hurt by declines of more than 1% each in its energy and basic-materials categories.
Treasurys prices climbed despite a report in The Wall Street Journal that the Federal Reserve is unlikely to significantly boost its purchases of Treasury and mortgage-backed paper when its rate committee meets June 23 and 24.
The news followed recent auctions of 10-year and 30-year Treasury debt that sent mixed messages about the level of demand for the tidal wave of paper the government is due to issue the next few years to fund its efforts to prop up the sagging U.S. economy.
A go-slow approach by the Fed would essentially be aimed at using that uptick in borrowing costs to stave off inflation, though skeptics on Wall Street believe the central bank could inadvertently choke off a recovery if it acts too soon. That debate carries heavy implications for every form of investment that changes hands on the world's trading floors.
"You can see right now, we're at this interesting fork in the road," said Paresh Upadhyaya, currency portfolio manager at Putnam Investments, which has bet against both the dollar and the euro because of the lingering weakness in those denominations' home economies.
"I just don't buy this inflation argument at all," Upadhyaya said. "The only reason I think we've seen Treasury yields drift higher is because of the increased supply we've already seen."
The direction of rates is vital to currency-focused managers because it affects how much return they can make by borrowing in one country's currency and lending the money out in loans denominated in another country's money.
On Friday, the dollar rallied on hopes that the Fed would essentially be protecting the greenback's value by refraining from Treasury purchases that would drive rates down. The U.S. Dollar Index was recently up 0.7%.
Currency traders also placed bets on possible outcomes from the meeting of the Group of Eight finance ministers in Italy starting Friday.
The dollar's rally pushed down the prices of raw materials traded globally in dollar terms. Oil futures, which have been hitting new 2009 highs in recent sessions, were down 63 cents to $72.05 a barrel in New York. The broad Dow Jones-UBS Commodity Index was off 1.3%.
Major commodity producers suffered as well. Alcoa was down 2.8%. U.S. Steel fell 5.3%. Chevron was down 0.6%.
Homebuilders also fell, reflecting a concern that a Fed that is newly hawkish on inflation could makes it more difficult for prospective home buyers to get mortgages. An ETF on the S&P's builders was down 2%. Among individual builders, KB Home was off 2.7%, Pulte Homes was down 1.4%, and Toll Brothers was off 1.7%.
The two-year note was recently unchanged, yielding 1.325%. The 10-year note gained 10/32 to yield 3.825%.
In economic news Friday, the government reported that import prices rose for a third straight month in May. Still, they were down 17.6% compared to May 2008, the largest one-year decline since the index was first published in 1982. While petroleum import prices rose 8.3% in May from April, they were down 51.4% on the year.
NOTE: the economic neews , the goverment reported that imoport price rose for a third straigh month in may.
Overseas, Asian shares ended mostly higher, led by Japanese stocks. Japan's Nikkei 225 rose 1.6%, making it back over the 10000 mark to touch an eight-month high, while South Korea's Kospi Composite gained 0.7%.
In Europe, stock markets fell modestly after dismal industrial production data fueled renewed concerns about the length and depth of the recession. The FTSE 100 Index fell 0.4%.
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* JUNE 12, 2009, 11:32 A.M. ET
US Stocks Decline Modestly On Strong Dollar, Weak Commodities
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By Peter A. McKay
Investors' simmering concerns about the U.S. government's finances led Friday to a stronger dollar, weaker commodity prices, and a modest stock-market slide.
The Dow Jones Industrial Average was down 11 points in recent trading. The Nasdaq Composite Index was recently off 1.2%. The S&P 500 fell 0.5%, hurt by declines of more than 1% each in its energy and basic-materials categories.
Treasurys prices climbed despite a report in The Wall Street Journal that the Federal Reserve is unlikely to significantly boost its purchases of Treasury and mortgage-backed paper when its rate committee meets June 23 and 24.
The news followed recent auctions of 10-year and 30-year Treasury debt that sent mixed messages about the level of demand for the tidal wave of paper the government is due to issue the next few years to fund its efforts to prop up the sagging U.S. economy.
A go-slow approach by the Fed would essentially be aimed at using that uptick in borrowing costs to stave off inflation, though skeptics on Wall Street believe the central bank could inadvertently choke off a recovery if it acts too soon. That debate carries heavy implications for every form of investment that changes hands on the world's trading floors.
"You can see right now, we're at this interesting fork in the road," said Paresh Upadhyaya, currency portfolio manager at Putnam Investments, which has bet against both the dollar and the euro because of the lingering weakness in those denominations' home economies.
"I just don't buy this inflation argument at all," Upadhyaya said. "The only reason I think we've seen Treasury yields drift higher is because of the increased supply we've already seen."
The direction of rates is vital to currency-focused managers because it affects how much return they can make by borrowing in one country's currency and lending the money out in loans denominated in another country's money.
On Friday, the dollar rallied on hopes that the Fed would essentially be protecting the greenback's value by refraining from Treasury purchases that would drive rates down. The U.S. Dollar Index was recently up 0.7%.
Currency traders also placed bets on possible outcomes from the meeting of the Group of Eight finance ministers in Italy starting Friday.
The dollar's rally pushed down the prices of raw materials traded globally in dollar terms. Oil futures, which have been hitting new 2009 highs in recent sessions, were down 63 cents to $72.05 a barrel in New York. The broad Dow Jones-UBS Commodity Index was off 1.3%.
Major commodity producers suffered as well. Alcoa was down 2.8%. U.S. Steel fell 5.3%. Chevron was down 0.6%.
Homebuilders also fell, reflecting a concern that a Fed that is newly hawkish on inflation could makes it more difficult for prospective home buyers to get mortgages. An ETF on the S&P's builders was down 2%. Among individual builders, KB Home was off 2.7%, Pulte Homes was down 1.4%, and Toll Brothers was off 1.7%.
The two-year note was recently unchanged, yielding 1.325%. The 10-year note gained 10/32 to yield 3.825%.
In economic news Friday, the government reported that import prices rose for a third straight month in May. Still, they were down 17.6% compared to May 2008, the largest one-year decline since the index was first published in 1982. While petroleum import prices rose 8.3% in May from April, they were down 51.4% on the year.
NOTE: the economic neews , the goverment reported that imoport price rose for a third straigh month in may.
Overseas, Asian shares ended mostly higher, led by Japanese stocks. Japan's Nikkei 225 rose 1.6%, making it back over the 10000 mark to touch an eight-month high, while South Korea's Kospi Composite gained 0.7%.
In Europe, stock markets fell modestly after dismal industrial production data fueled renewed concerns about the length and depth of the recession. The FTSE 100 Index fell 0.4%.
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* [WK-AQ070_pianis_C_20090611132752.jpg]
Blazing a New Path in Classical Music
* [Russian Prime Minister Vladimir Putin attends a meeting with Cabinet officials in Moscow on May 25.]
Russians Outfox U.S. in Latest Great Game
* [LeBron James]
Shaking the Hand That Defeats You
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Iranian Contenders Court Women Voters
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Subscriber Content Read Preview
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Strip Clubs Pare Upscale Offerings
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Market Downturn Hit Lawmakers
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Wednesday, July 8, 2009
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12
Currency, Oil, Silver Analysis and Charts
Anna Coulling @ 9:57 AM, Friday June 12 2009 Article Rating
Euro vs Dollar - Daily Eurodollar Chart 12th June 2009
Eurodollar - EUR vs USD Daily Chart 12th June 2009
Eurodollar - EUR vs USD Daily Chart 12th June 2009
One of the questions I am often asked is at what point dollar strength will return to the market, accompanied by a weakening of the Euro as many traders, analysts and economists are confused with the current technical picture given the dire stream of fundamental news on the economic calendar for Europe. Recent examples include the German GDP figures and this morning's Industrial Production figures which plunged to a new record low, falling by 22% across the Eurozone. By any standards we should have expected a significant rally in the US dollar as a result of such poor figures and yet the Euro continues to maintain its upwards path, and one can only assume that this is fuelled on sentiment rather than fact, but also largely helped by the US Fed who promote the sale of dollars at every opportunity. This was evidenced once again by Dennis Lockhart's remarks that the "USD role as reserve currency may decline; not made up mind yet to increase Treasury purchases" If and until this anti dollar rhetoric changes it is unlikely that we will see any dollar strength return. As currency traders we need to be aware of this as the impact on the forex market cannot be ignored making trading this pair extremely difficult. This dollar weakness rhetoric also spills over into the energy complex and commodities, and until oil prices reverse dramatically then this imbalance will continue unabated.
Technically the eurodollar pair continue to grind their way upwards with a series of closing prices which are each marginally higher than the previous day, with yesterday's candle managing to break and hold above both the 9 and 14 day moving averages. However, this is hardly a convincing trading signal and with the G8 and G20 meetings currently ongoing further sideways consolidation seems inevitable and may even continue into next week if no significant news is forthcoming from these meetings. My trading suggestion is therefore to stay out today and wait until Monday when the market will have had an opportunity to absorb any announcements, and indeed there may be some reaction when the market opens on Sunday night.
Dollars To Pounds - GBP/USD Daily Chart 12th June 2009
Dollars To Pounds - GBP/USD Daily Forex Chart 12th June 2009
Dollars To Pounds - GBP/USD Daily Forex Chart 12th June 2009
Yesterday's wide spread up bar added further momentum to the already bullish British Pound as it continued its meteoric rise from the ashes of earlier in the year, fuelled by anti US dollar rhetoric from the US administration and unhelpful comments from FMOC such as Dennis Flockhart. The pounds to dollars candle closed well above all three moving averages and holding above the minor support level created during last week's turbulence during the political uncertainty in the UK. With further dollar weakness likely it seems that our initial target of 1.6725 has appeared on the horizon sooner rather than later, and any reversal, as we have seen in this morning's trading, may well be the market taking a breather as participants take their profits off the table, before continuing to push Cable higher. Currency markets this morning have exhibited a degree of instability and volatility owing to the G8 and G20 meetings in Italy and Germany respectively which are now running over the next couple of days and any accidental or scripted comments will be closely analysed for any hidden clues as to future monetary policy. The above meetings overshadow the economic news on the economic calendar, which is generally minor, and will have little impact given the significance of these meetings.
NOTE: the currency markets this morning have exhibited adegree of instablity and volatility owing to the G8 and G20 meeting in italy and germany respectively witch are now running over the next coulpe of days and any accidental.
USD/JPY - US Dollar vs Japanese Yen 12th June 2009
US Dollar vs Japanese Yen - USD/JPY Daily Candle Chart 12th June 2009
US Dollar vs Japanese Yen - USD/JPY Daily Candle Chart 12th June 2009
An exciting week on the dollar yen chart, starting with a spinning top on Monday, down bar Tuesday, up bar Wednesday, down bar Thursday and an up bar today - metronomic, lethargic and impossible to trade as the Fed and BOJ slug it out. Like two overweight, punch drunk heavyweight fighters these two leviathans of the currency market are now trading blows in an attempt to force their respective currencies to the bottom. For this reason there is no clear bias to the dollar vs yen and you trade this pair at your peril given that the fundamental news on the economic calendar for both the US and Japan is equally dire. Unless and until there is a knockout by one or the other my suggestion is to stay OUT.
USD vs CAD - US Dollar to Canadian Dollar 12th June 2009
USD to CAD - Daily Chart For The USD/CAD 12th June 2009
USD to CAD - Daily Chart For The USD/CAD 12th June 2009
The dollar to cad continued to consolidate yesterday ending the day on a narrow spread up bar with a small lower wick which found some support in the 1.0950 region which aligned closely with the previous lows of the last few days, and closing marginally below the 9 day moving average. It is interesting to note that these two averages are now converging and indeed about to cross, suggesting that we may see a short squeeze in this pair once again, a pattern which has emerged in early trading today. Whether this will convert into a longer term reversal or is simply as a result of some dollar strength temporarily returning to the market, only time will tell. With constant negative sentiment emanating from the US administration and, in particular, from Fed Members such as Dennis Lockhart, a sustained rally in the US dollar is extremely unlikely until this anti dollar rhetoric ceases. With the G8 and G20 meetings now in progress in Italy and Germany respectively, and with the weekend ahead, now is not the time to be trading on such an uncertain and volatile day. My suggestion is therefore to wait until early next week before entering the market which, by then, will have had a chance to absorb any news from these meeting.
Crude Oil Price - Daily WTI Oil Chart 12th June 2009
WTI Daily Oil Price Chart - Oil Prices 12th June 2009
Crude oil prices just keep marching on supported both from strengthening equity markets and a further weakening of the US dollar, particularly against the Euro. The oil market is used to anti Dollar rhetoric from the likes of Iran, Russia and Venezuela but when it comes from Fed Member Lockhart who yesterday stated ""USD role as reserve currency may decline; not made up mind yet to increase Treasury purchases" there really is no hope. Meanwhile the IEA monthly report showed an upward revision to its 2009 global oil demand figures thereby hinting that crude oil prices are likely to be boosted given this shift in the fundamentals. It will be interesting to see how OPEC producers respond to the increase in daily oil prices and whether the agreed production cuts will in fact hold. From a technical perspective yesterday's oil chart saw crude oil prices climb even higher and at one point achieve an inter day high of $73.23 per barrel. Despite a small hiccup in the rally the price of oil finished 92 cents higher to settle at $72.47. The oil chart is now pointing to the $74.28 minor resistance level, last seen on 17th October 2008 and with the oil market in buoyant mood and moving further away from all three moving averages we should not be surprised to see a retracement at some point in the near
The short and medium term trends are bullish and the long term trend is bullish.
WTI:
Support: $71.32 (yesterday's low) Resistance: $75.85 (high of 21/10/08)
Support: $70.51 (low of 10/06/09) Resistance: $74.28 (high of 17/10/08)
Support: $68.44 (low of 09/06/09) Resistance: $73.23 (yesterday's high)
OIL (BRENT):
Support: $70.63 (yesterday's low) Resistance: $75.04 (high of 15/10/08)
Support: $69.92 (low of 10/06/09) Resistance: $73.29 (high of 21/10/08)
Support: $68.24 (low of 09/06/09) Resistance: $72.27 (yesterday's high)
Spot Silver Price - Daily Silver Chart 12th June 2009
Silver Spot Prices - Daily Silver Chart 12th June 2009
A combination of a weaker US dollar and increasing optimism about industrial demand once again provided support for spot silver prices which ended the day 17 cents higher at $15.390 per ounce and in percentage terms once again outperformed spot gold. The current rally in silver prices mirrors similar bullish sentiment in other commodities such as oil where despite the somewhat bleak fundamental picture, investors appear determined to maintain the upward trend across the commodities market. From a technical perspective the silver chart is very similar to that of gold in that prices are consolidating in a very narrow range. The only minor difference between the two is that the price of silver has shown a marginally more bullish trend on the week with candles that are slightly more descriptive (gold has had a series of doji candles which are indicative of indecision and sideways movement). Yesterday's candle was typical with a small increase on the day closing marginally below the 9 day moving average but with a deep lower wick which seems to have found some support on the 14 day moving average and with each day's candle having a low which is higher than the previous day, again suggesting a bullish flavour. However, today is not a day for trading for several reasons. First it is the end of the week and many traders will be squaring positions ahead of the weekend. Second we have the G8 finance ministers' meeting in Italy where unprompted off the cuff remarks will be seized on by the markets, and all the markets are now waiting for this meeting to unfold so today is likely to be characterized by a further period of consolidation and sideways movement.
The short term is sideways while the medium and long term is bullish.
Support: $14.930 (yesterday's low) Resistance: $15.950 (high of 04/06/09)
Support: $14.760 (low of 09/06/09) Resistance: $15.760 (high of 29/05/09)
Support: $14.620 (low of 28/05/09) Resistance: $15.532 (yesterday's high)
Anna's Websites Below:
http://www.euro-vs-dollar.com
http://www.euro-to-dollar.com
http://www.usd-to-cad.com
http://www.yen-to-dollar.com
http://www.prices-oil.org
http://www.spot-gold-price.org
http://www.pounds-to-dollars.com
http://www.spot-silver.com
http://www.cot-report.com
http://www.currency-trading-forex.com
http://euros-to-pounds.com
Categories: EURUSD, USDJPY, USDCAD, GBPUSD Bullish, Commodities
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12
Currency, Oil, Silver Analysis and Charts
Anna Coulling @ 9:57 AM, Friday June 12 2009 Article Rating
Euro vs Dollar - Daily Eurodollar Chart 12th June 2009
Eurodollar - EUR vs USD Daily Chart 12th June 2009
Eurodollar - EUR vs USD Daily Chart 12th June 2009
One of the questions I am often asked is at what point dollar strength will return to the market, accompanied by a weakening of the Euro as many traders, analysts and economists are confused with the current technical picture given the dire stream of fundamental news on the economic calendar for Europe. Recent examples include the German GDP figures and this morning's Industrial Production figures which plunged to a new record low, falling by 22% across the Eurozone. By any standards we should have expected a significant rally in the US dollar as a result of such poor figures and yet the Euro continues to maintain its upwards path, and one can only assume that this is fuelled on sentiment rather than fact, but also largely helped by the US Fed who promote the sale of dollars at every opportunity. This was evidenced once again by Dennis Lockhart's remarks that the "USD role as reserve currency may decline; not made up mind yet to increase Treasury purchases" If and until this anti dollar rhetoric changes it is unlikely that we will see any dollar strength return. As currency traders we need to be aware of this as the impact on the forex market cannot be ignored making trading this pair extremely difficult. This dollar weakness rhetoric also spills over into the energy complex and commodities, and until oil prices reverse dramatically then this imbalance will continue unabated.
Technically the eurodollar pair continue to grind their way upwards with a series of closing prices which are each marginally higher than the previous day, with yesterday's candle managing to break and hold above both the 9 and 14 day moving averages. However, this is hardly a convincing trading signal and with the G8 and G20 meetings currently ongoing further sideways consolidation seems inevitable and may even continue into next week if no significant news is forthcoming from these meetings. My trading suggestion is therefore to stay out today and wait until Monday when the market will have had an opportunity to absorb any announcements, and indeed there may be some reaction when the market opens on Sunday night.
Dollars To Pounds - GBP/USD Daily Chart 12th June 2009
Dollars To Pounds - GBP/USD Daily Forex Chart 12th June 2009
Dollars To Pounds - GBP/USD Daily Forex Chart 12th June 2009
Yesterday's wide spread up bar added further momentum to the already bullish British Pound as it continued its meteoric rise from the ashes of earlier in the year, fuelled by anti US dollar rhetoric from the US administration and unhelpful comments from FMOC such as Dennis Flockhart. The pounds to dollars candle closed well above all three moving averages and holding above the minor support level created during last week's turbulence during the political uncertainty in the UK. With further dollar weakness likely it seems that our initial target of 1.6725 has appeared on the horizon sooner rather than later, and any reversal, as we have seen in this morning's trading, may well be the market taking a breather as participants take their profits off the table, before continuing to push Cable higher. Currency markets this morning have exhibited a degree of instability and volatility owing to the G8 and G20 meetings in Italy and Germany respectively which are now running over the next couple of days and any accidental or scripted comments will be closely analysed for any hidden clues as to future monetary policy. The above meetings overshadow the economic news on the economic calendar, which is generally minor, and will have little impact given the significance of these meetings.
NOTE: the currency markets this morning have exhibited adegree of instablity and volatility owing to the G8 and G20 meeting in italy and germany respectively witch are now running over the next coulpe of days and any accidental.
USD/JPY - US Dollar vs Japanese Yen 12th June 2009
US Dollar vs Japanese Yen - USD/JPY Daily Candle Chart 12th June 2009
US Dollar vs Japanese Yen - USD/JPY Daily Candle Chart 12th June 2009
An exciting week on the dollar yen chart, starting with a spinning top on Monday, down bar Tuesday, up bar Wednesday, down bar Thursday and an up bar today - metronomic, lethargic and impossible to trade as the Fed and BOJ slug it out. Like two overweight, punch drunk heavyweight fighters these two leviathans of the currency market are now trading blows in an attempt to force their respective currencies to the bottom. For this reason there is no clear bias to the dollar vs yen and you trade this pair at your peril given that the fundamental news on the economic calendar for both the US and Japan is equally dire. Unless and until there is a knockout by one or the other my suggestion is to stay OUT.
USD vs CAD - US Dollar to Canadian Dollar 12th June 2009
USD to CAD - Daily Chart For The USD/CAD 12th June 2009
USD to CAD - Daily Chart For The USD/CAD 12th June 2009
The dollar to cad continued to consolidate yesterday ending the day on a narrow spread up bar with a small lower wick which found some support in the 1.0950 region which aligned closely with the previous lows of the last few days, and closing marginally below the 9 day moving average. It is interesting to note that these two averages are now converging and indeed about to cross, suggesting that we may see a short squeeze in this pair once again, a pattern which has emerged in early trading today. Whether this will convert into a longer term reversal or is simply as a result of some dollar strength temporarily returning to the market, only time will tell. With constant negative sentiment emanating from the US administration and, in particular, from Fed Members such as Dennis Lockhart, a sustained rally in the US dollar is extremely unlikely until this anti dollar rhetoric ceases. With the G8 and G20 meetings now in progress in Italy and Germany respectively, and with the weekend ahead, now is not the time to be trading on such an uncertain and volatile day. My suggestion is therefore to wait until early next week before entering the market which, by then, will have had a chance to absorb any news from these meeting.
Crude Oil Price - Daily WTI Oil Chart 12th June 2009
WTI Daily Oil Price Chart - Oil Prices 12th June 2009
Crude oil prices just keep marching on supported both from strengthening equity markets and a further weakening of the US dollar, particularly against the Euro. The oil market is used to anti Dollar rhetoric from the likes of Iran, Russia and Venezuela but when it comes from Fed Member Lockhart who yesterday stated ""USD role as reserve currency may decline; not made up mind yet to increase Treasury purchases" there really is no hope. Meanwhile the IEA monthly report showed an upward revision to its 2009 global oil demand figures thereby hinting that crude oil prices are likely to be boosted given this shift in the fundamentals. It will be interesting to see how OPEC producers respond to the increase in daily oil prices and whether the agreed production cuts will in fact hold. From a technical perspective yesterday's oil chart saw crude oil prices climb even higher and at one point achieve an inter day high of $73.23 per barrel. Despite a small hiccup in the rally the price of oil finished 92 cents higher to settle at $72.47. The oil chart is now pointing to the $74.28 minor resistance level, last seen on 17th October 2008 and with the oil market in buoyant mood and moving further away from all three moving averages we should not be surprised to see a retracement at some point in the near
The short and medium term trends are bullish and the long term trend is bullish.
WTI:
Support: $71.32 (yesterday's low) Resistance: $75.85 (high of 21/10/08)
Support: $70.51 (low of 10/06/09) Resistance: $74.28 (high of 17/10/08)
Support: $68.44 (low of 09/06/09) Resistance: $73.23 (yesterday's high)
OIL (BRENT):
Support: $70.63 (yesterday's low) Resistance: $75.04 (high of 15/10/08)
Support: $69.92 (low of 10/06/09) Resistance: $73.29 (high of 21/10/08)
Support: $68.24 (low of 09/06/09) Resistance: $72.27 (yesterday's high)
Spot Silver Price - Daily Silver Chart 12th June 2009
Silver Spot Prices - Daily Silver Chart 12th June 2009
A combination of a weaker US dollar and increasing optimism about industrial demand once again provided support for spot silver prices which ended the day 17 cents higher at $15.390 per ounce and in percentage terms once again outperformed spot gold. The current rally in silver prices mirrors similar bullish sentiment in other commodities such as oil where despite the somewhat bleak fundamental picture, investors appear determined to maintain the upward trend across the commodities market. From a technical perspective the silver chart is very similar to that of gold in that prices are consolidating in a very narrow range. The only minor difference between the two is that the price of silver has shown a marginally more bullish trend on the week with candles that are slightly more descriptive (gold has had a series of doji candles which are indicative of indecision and sideways movement). Yesterday's candle was typical with a small increase on the day closing marginally below the 9 day moving average but with a deep lower wick which seems to have found some support on the 14 day moving average and with each day's candle having a low which is higher than the previous day, again suggesting a bullish flavour. However, today is not a day for trading for several reasons. First it is the end of the week and many traders will be squaring positions ahead of the weekend. Second we have the G8 finance ministers' meeting in Italy where unprompted off the cuff remarks will be seized on by the markets, and all the markets are now waiting for this meeting to unfold so today is likely to be characterized by a further period of consolidation and sideways movement.
The short term is sideways while the medium and long term is bullish.
Support: $14.930 (yesterday's low) Resistance: $15.950 (high of 04/06/09)
Support: $14.760 (low of 09/06/09) Resistance: $15.760 (high of 29/05/09)
Support: $14.620 (low of 28/05/09) Resistance: $15.532 (yesterday's high)
Anna's Websites Below:
http://www.euro-vs-dollar.com
http://www.euro-to-dollar.com
http://www.usd-to-cad.com
http://www.yen-to-dollar.com
http://www.prices-oil.org
http://www.spot-gold-price.org
http://www.pounds-to-dollars.com
http://www.spot-silver.com
http://www.cot-report.com
http://www.currency-trading-forex.com
http://euros-to-pounds.com
Categories: EURUSD, USDJPY, USDCAD, GBPUSD Bullish, Commodities
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Google Ads Warning Advertisement Links from Google are displayed throughout the site and do not reflect the opinion, endorsement, or concurrence of this website or affiliated parties. Google ads contain potentially misleading and/or unbalanced claims and information that may fail to disclose risks and other important considerations involved in speculative trading.
High-Risk Warning Forex, Futures, and Options trading has large potential rewards, but also large potential risks. The high degree of leverage can work against you as well as for you. You must be aware of the risks of investing in forex, futures, and options and be willing to accept them in order to trade in these markets. Forex trading involves substantial risk of loss and is not suitable for all investors. Please do not trade with borrowed money or money you cannot afford to lose. This website is neither a solicitation nor an offer to Buy or Sell currencies, futures, or options. No representation is being made that any account will or is likely to achieve profits or losses similar to those discussed on this website. Any opinions, news, research, analysis, prices, or other information contained on this website is provided as general market commentary and does not constitute investment advice. Website owners and affiliates will not accept liability for any loss or damage, including without limitation to, any loss of profit, which may arise directly or indirectly from the use of or reliance on such information. Please remember that the past performance of any trading system or methodology is not necessarily indicative of future results.
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DOLLAR EDGES UP , INVESTORS EYE G8 MEETING
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FOREX-Dollar edges up, investors eye G8 meeting
Fri Jun 12, 2009 4:27am EDT
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Market News
Shares flat ahead of G8 as data digested
Oil falls towards $72 after three-day rally
Dollar edges up, investors eye G8 meeting
More Business & Investing News...
* Dollar index up 0.3 pct, traders book profits
* G8 meet in focus, ministers to discuss exit strategies
* Optimistic global economy view may pressure dollar more
(Adds comment, details, updates throughout; previous TOKYO)
By Naomi Tajitsu
LONDON, June 12 (Reuters) - The dollar edged up against a basket of currencies on Friday, recovering as traders booked profits from the U.S. currency's slide earlier this week, while investors awaited a G8 finance ministers meet later in the day.
The euro hit the day's low against the dollar after European shares initially slipped in early trade. This helped the U.S. currency to recover from losses on Thursday, when improving U.S. economic data stoked risk demand and prompted dollar selling.
The dollar has been on the back foot during a week of fairly volatile trade, and is set to end the week 1.3 percent lower against a currency basket after investors reassessed speculation that U.S. interest rates may rise from near zero by year-end.
Analysts said that trade would be subdued as few European economic data and events were due on Friday, while investors would focus on comments that may come out of the G8 gathering.
Sources have said that currencies would not be a major point of discussion at the two-day meeting, but a German official said that eventual exit strategies from policies to deal with the financial crisis will be a topic. [ID:nLB661036]
NOTE:the sourse have a currencies would not be a major point of dicussion at the two day meeting.
"We've been swinging back and forth quite a bit this week ... With the G8 in front of us, it may offer a good excuse not to engage to heavily in the market at the moment," said Dag Muller, technical analyst at SEB in Stockholm.
Market participants said that finance ministers would likely promote the idea that the global economy is on the path to recovery, which may prompt more demand for riskier assets.
"(The finance ministers) may underpin positive sentiment in the market ... if you think the dollar is tightly linked to risk appetite, then this would be dollar negative."
By 0806 GMT, the euro traded 0.2 percent lower at $1.4070, after slipping to a session low around $1.4055, still above the week's low of $1.3803 hit on Monday.
The dollar index .DXY, which tracks the currency's performance against six major rivals, edged up 0.2 percent to 79.727. Continued...
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FOREX-Dollar edges up, investors eye G8 meeting
Fri Jun 12, 2009 4:27am EDT
Email | Print |
Share
| Reprints | Single Page
[-] Text [+]
Market News
Shares flat ahead of G8 as data digested
Oil falls towards $72 after three-day rally
Dollar edges up, investors eye G8 meeting
More Business & Investing News...
* Dollar index up 0.3 pct, traders book profits
* G8 meet in focus, ministers to discuss exit strategies
* Optimistic global economy view may pressure dollar more
(Adds comment, details, updates throughout; previous TOKYO)
By Naomi Tajitsu
LONDON, June 12 (Reuters) - The dollar edged up against a basket of currencies on Friday, recovering as traders booked profits from the U.S. currency's slide earlier this week, while investors awaited a G8 finance ministers meet later in the day.
The euro hit the day's low against the dollar after European shares initially slipped in early trade. This helped the U.S. currency to recover from losses on Thursday, when improving U.S. economic data stoked risk demand and prompted dollar selling.
The dollar has been on the back foot during a week of fairly volatile trade, and is set to end the week 1.3 percent lower against a currency basket after investors reassessed speculation that U.S. interest rates may rise from near zero by year-end.
Analysts said that trade would be subdued as few European economic data and events were due on Friday, while investors would focus on comments that may come out of the G8 gathering.
Sources have said that currencies would not be a major point of discussion at the two-day meeting, but a German official said that eventual exit strategies from policies to deal with the financial crisis will be a topic. [ID:nLB661036]
NOTE:the sourse have a currencies would not be a major point of dicussion at the two day meeting.
"We've been swinging back and forth quite a bit this week ... With the G8 in front of us, it may offer a good excuse not to engage to heavily in the market at the moment," said Dag Muller, technical analyst at SEB in Stockholm.
Market participants said that finance ministers would likely promote the idea that the global economy is on the path to recovery, which may prompt more demand for riskier assets.
"(The finance ministers) may underpin positive sentiment in the market ... if you think the dollar is tightly linked to risk appetite, then this would be dollar negative."
By 0806 GMT, the euro traded 0.2 percent lower at $1.4070, after slipping to a session low around $1.4055, still above the week's low of $1.3803 hit on Monday.
The dollar index .DXY, which tracks the currency's performance against six major rivals, edged up 0.2 percent to 79.727. Continued...
View article on single page
Previous Page 1 | 2 Next Page
Share:
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Next Article: UPDATE 2-Tough budget cuts saved Latvia from bankrupcty-PM
Also on Reuters
A man keys in a message onto a mobile phone in a Milan bar March 3, 2006.
Bad text messaging, e-mailing manners can be costly
Matt Bording carries a packed box from his foreclosed home in Richmond, California June 8, 2009.
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Pedestrians walk past a Bank of America branch in New York May 8, 2009. REUTERS/Lucas Jackson
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Tuesday, July 7, 2009
MALAYSIA -- CHINA FX SWAP TO HELP TRADE TO START SOON
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Malaysia-China FX swap to help trade to start soon
06.12.09, 03:55 AM EDT
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BEIJING, June 12 (Reuters) - Exporters and importers in Malaysia and China will soon have the option of settling their trade deals in ringgit and yuan when a currency swap between the two countries' central banks goes into effect.
Malaysian central bank governor Zeti Akhtar Aziz told reporters that the swap, signed in February and worth 80 billion yuan/40 billion ringgit, would go into operation 'in the near term'.
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The swap was arranged explicitly to boost two-way trade and investment, not to provide liquidity, which Zeti said was ample in the Malaysian banking system.
The People's Bank of China has arranged six such swaps, totalling 650 billion yuan ($95.12 billion), since December.
Sceptics see little reason why traders should abandon the convenience of the dollar, the main trade settlement currency; an agreement between Brazil and Argentina to settle bilateral trade in their respective currencies has had scant take-up.
Zeti said it was too early to say what the response would be in Malaysia, but the scheme would provide additional flexibility for companies whose margins are under pressure.
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'There will be those who see the benefit of reduced transaction costs and reduced exposure to currency volatility,' she said on the sidelines of a banking conference.
Turning to the economy, Zeti said fiscal stimulus measures introduced in the first quarter, coupled with steps to increase access to financing, would feed through to the economy in the second half of 2009, particularly in the final quarter.
'Our current assesment is that growth will turn positive in the fourth quarter, year on year,' she said.
Asked whether interest rates had scope to fall, Zeti said the central bank was focusing on making it easier for companies to borrow through credit enhancement schemes and corporate debt restructuring, rather than on the cost of borrowing.
NOTE: the swamp was arrange explicitly to not provide liquidit, which zeti said was ample in the malaysia banking system.
'All this is more important than the cost,' she said.
(Reporting by Alan Wheatley; Editing by Jonathan Hopfner)
((alan.wheatley@thomsonreuters.com; +86 10 6...; alan.wheatley.reuters.com@reuters.net)) ($1=6.833 Yuan) Keywords: MALAYSIA CHINA/ECONOMY
(If you have a query or comment on this story, send an email to news.feedback.asia@thomsonreuters.com)
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Thomson Reuters
Malaysia-China FX swap to help trade to start soon
06.12.09, 03:55 AM EDT
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BEIJING, June 12 (Reuters) - Exporters and importers in Malaysia and China will soon have the option of settling their trade deals in ringgit and yuan when a currency swap between the two countries' central banks goes into effect.
Malaysian central bank governor Zeti Akhtar Aziz told reporters that the swap, signed in February and worth 80 billion yuan/40 billion ringgit, would go into operation 'in the near term'.
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The swap was arranged explicitly to boost two-way trade and investment, not to provide liquidity, which Zeti said was ample in the Malaysian banking system.
The People's Bank of China has arranged six such swaps, totalling 650 billion yuan ($95.12 billion), since December.
Sceptics see little reason why traders should abandon the convenience of the dollar, the main trade settlement currency; an agreement between Brazil and Argentina to settle bilateral trade in their respective currencies has had scant take-up.
Zeti said it was too early to say what the response would be in Malaysia, but the scheme would provide additional flexibility for companies whose margins are under pressure.
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'There will be those who see the benefit of reduced transaction costs and reduced exposure to currency volatility,' she said on the sidelines of a banking conference.
Turning to the economy, Zeti said fiscal stimulus measures introduced in the first quarter, coupled with steps to increase access to financing, would feed through to the economy in the second half of 2009, particularly in the final quarter.
'Our current assesment is that growth will turn positive in the fourth quarter, year on year,' she said.
Asked whether interest rates had scope to fall, Zeti said the central bank was focusing on making it easier for companies to borrow through credit enhancement schemes and corporate debt restructuring, rather than on the cost of borrowing.
NOTE: the swamp was arrange explicitly to not provide liquidit, which zeti said was ample in the malaysia banking system.
'All this is more important than the cost,' she said.
(Reporting by Alan Wheatley; Editing by Jonathan Hopfner)
((alan.wheatley@thomsonreuters.com; +86 10 6...; alan.wheatley.reuters.com@reuters.net)) ($1=6.833 Yuan) Keywords: MALAYSIA CHINA/ECONOMY
(If you have a query or comment on this story, send an email to news.feedback.asia@thomsonreuters.com)
COPYRIGHT
Copyright Thomson Reuters 2009. All rights reserved.
The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
Neither the Subscriber nor Thomson Reuters warrants the completeness or accuracy of the Service or the suitability of the Service as a trading aid and neither accepts any liability for losses howsoever incurred. The content on this site, including news, quotes, data and other information, is provided by Thomson Reuters and its third party content providers for your personal information only, and neither Thomson Reuters nor its third party content providers shall be liable for any errors, inaccuracies or delays in content, or for any actions taken in reliance thereon.
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VALUE OF N,KOREASANCTIONS DISPUTED
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By Blaine Harden
Washington Post Foreign Service
Friday, June 12, 2009
TOKYO, June 11 -- As the United Nations moves this week to sanction North Korea for its second nuclear test, there is strong evidence that a previous international squeeze did not work.
Thanks to booming business with neighboring China, North Korea's overseas trade has grown substantially since the U.N. Security Council imposed punitive sanctions after the government of Kim Jong Il exploded its first nuclear device in 2006.
Trade volume rose last year to its highest level since 1990, when a far more prosperous and less isolated North Korea was heavily subsidized by the Soviet Union, according to an analysis by the Korea Trade-Investment Promotion Agency, a government-funded organization in Seoul.
North Korean exports surged 23 percent last year, compared with the previous year, and imports jumped 33 percent, the agency said. It found that China's share of overseas trade with the North is soaring, up from 33 percent in 2003 to 73 percent last year.
The Security Council sanctions have had "no perceptible effect" on North Korea's trade with its largest partners, according to another study by Marcus Noland, a North Korea expert at the Washington-based Peterson Institute for International Economics.
"In retrospect, North Korea may have calculated quite correctly that direct penalties for establishing itself as a nuclear power would be modest," Noland wrote in a paper published at the end of last year. "If sanctions are to deter behavior in the future, they will have to be much more enthusiastically implemented."
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A draft resolution proposed this week by the United States, China and other major powers tries to be more enthusiastic. If approved, the resolution would restrict the North's access to international grants, financial assistance and low-interest loans, while reinvigorating enforcement of the sanctions approved after Pyongyang's first nuclear test.
With certain caveats, it also authorizes member nations to search ships suspected of carrying banned materials, such as missiles or nuclear technology, on the high seas and to seize what they find. But it would not limit North Korea's more conventional, and lucrative, trade with China.
Noland describes the current sanctions plan as "clever." Instead of a "crime and punishment" approach to North Korea, he said, the proposed sanctions are "basically defensive," relying on interdiction of ships and global financial restrictions.
NOTE:a draft of a resulution propose this week by the united states, the china and major powers tries to be more enthusiastic.
In recent decades, North Korea has earned hundreds of millions of dollars by transporting missiles and missile parts to countries in East Asia and the Middle East, according to the Center for Nonproliferation Studies in Monterey, Calif.
"The North Koreans will be down to whatever China gives them and whatever they can get from their subterranean customers in the Middle East," Noland said.
But there is little chance that these tougher sanctions will limit the ability of Kim Jong Il's government to profit from more conventional overseas trade, said Lim Eul-chul, a researcher who specializes in North Korean trade for the Seoul-based Institute for Far Eastern Studies.
"The sanctions will not have much effect on what North Korea trades with China," he said.
A sharp increase in military tension on the Korean Peninsula has recently made the North "very reluctant to export sensitive items overseas," such as missiles and counterfeit goods, said Lim, who has monitored North Korean trade for years.
"That kind of trade is not the current story," Lim said. "The current story is that North Korea is doing a lot of normal trade with China."
North Korea consistently fails to grow enough food to feed its 23 million people, and its state-controlled economy is moribund, but it does have mineral resources that are coveted by many industrialized countries.
The estimated value of its reserves -- including coal, iron ore, zinc, uranium and the world's largest known deposit of magnesite, which is essential for making lightweight metal for airplanes and electronics -- is more than $2 trillion, according to the Korea Chamber of Commerce and Industry.
The manufacturing boom in neighboring China has dovetailed with North Korea's acute need for hard currency and has accelerated Chinese access to the North's resources, according to Lim, Chinese mining experts and South Korean government officials.
There is, however, a significant new wrinkle in the North's trade with China, Lim said. "The military is taking control of export sales," he said, citing informants inside North Korea.
Other branches of the North Korean government, such as the Workers' Party and the cabinet, have been forced to relinquish their interest in these sales to the military, Lim said. The military has grabbed greater control of export revenue, he said, as it has provoked the outside world with missile launches and the nuclear test.
Based on the recent growth of North Korean-Chinese trade, Lim said he does not believe that China wants to "take any strong measures to crush the North Korean economy."
As China's trade with the North has soared, South Korea's has fallen off sharply, a victim of the undisguised contempt that Kim Jong Il's government has shown toward South Korean President Lee Myung-bak.
After Lee came into office last year, he halted a decade-old policy of giving the North unconditional gifts of food and fertilizer. North-South trade fell nearly 25 percent in the first four months of 2009, according to the Korean Customs office.
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Value of N. Korea Sanctions Disputed
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By Blaine Harden
Washington Post Foreign Service
Friday, June 12, 2009
TOKYO, June 11 -- As the United Nations moves this week to sanction North Korea for its second nuclear test, there is strong evidence that a previous international squeeze did not work.
Thanks to booming business with neighboring China, North Korea's overseas trade has grown substantially since the U.N. Security Council imposed punitive sanctions after the government of Kim Jong Il exploded its first nuclear device in 2006.
Trade volume rose last year to its highest level since 1990, when a far more prosperous and less isolated North Korea was heavily subsidized by the Soviet Union, according to an analysis by the Korea Trade-Investment Promotion Agency, a government-funded organization in Seoul.
North Korean exports surged 23 percent last year, compared with the previous year, and imports jumped 33 percent, the agency said. It found that China's share of overseas trade with the North is soaring, up from 33 percent in 2003 to 73 percent last year.
The Security Council sanctions have had "no perceptible effect" on North Korea's trade with its largest partners, according to another study by Marcus Noland, a North Korea expert at the Washington-based Peterson Institute for International Economics.
"In retrospect, North Korea may have calculated quite correctly that direct penalties for establishing itself as a nuclear power would be modest," Noland wrote in a paper published at the end of last year. "If sanctions are to deter behavior in the future, they will have to be much more enthusiastically implemented."
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A draft resolution proposed this week by the United States, China and other major powers tries to be more enthusiastic. If approved, the resolution would restrict the North's access to international grants, financial assistance and low-interest loans, while reinvigorating enforcement of the sanctions approved after Pyongyang's first nuclear test.
With certain caveats, it also authorizes member nations to search ships suspected of carrying banned materials, such as missiles or nuclear technology, on the high seas and to seize what they find. But it would not limit North Korea's more conventional, and lucrative, trade with China.
Noland describes the current sanctions plan as "clever." Instead of a "crime and punishment" approach to North Korea, he said, the proposed sanctions are "basically defensive," relying on interdiction of ships and global financial restrictions.
NOTE:a draft of a resulution propose this week by the united states, the china and major powers tries to be more enthusiastic.
In recent decades, North Korea has earned hundreds of millions of dollars by transporting missiles and missile parts to countries in East Asia and the Middle East, according to the Center for Nonproliferation Studies in Monterey, Calif.
"The North Koreans will be down to whatever China gives them and whatever they can get from their subterranean customers in the Middle East," Noland said.
But there is little chance that these tougher sanctions will limit the ability of Kim Jong Il's government to profit from more conventional overseas trade, said Lim Eul-chul, a researcher who specializes in North Korean trade for the Seoul-based Institute for Far Eastern Studies.
"The sanctions will not have much effect on what North Korea trades with China," he said.
A sharp increase in military tension on the Korean Peninsula has recently made the North "very reluctant to export sensitive items overseas," such as missiles and counterfeit goods, said Lim, who has monitored North Korean trade for years.
"That kind of trade is not the current story," Lim said. "The current story is that North Korea is doing a lot of normal trade with China."
North Korea consistently fails to grow enough food to feed its 23 million people, and its state-controlled economy is moribund, but it does have mineral resources that are coveted by many industrialized countries.
The estimated value of its reserves -- including coal, iron ore, zinc, uranium and the world's largest known deposit of magnesite, which is essential for making lightweight metal for airplanes and electronics -- is more than $2 trillion, according to the Korea Chamber of Commerce and Industry.
The manufacturing boom in neighboring China has dovetailed with North Korea's acute need for hard currency and has accelerated Chinese access to the North's resources, according to Lim, Chinese mining experts and South Korean government officials.
There is, however, a significant new wrinkle in the North's trade with China, Lim said. "The military is taking control of export sales," he said, citing informants inside North Korea.
Other branches of the North Korean government, such as the Workers' Party and the cabinet, have been forced to relinquish their interest in these sales to the military, Lim said. The military has grabbed greater control of export revenue, he said, as it has provoked the outside world with missile launches and the nuclear test.
Based on the recent growth of North Korean-Chinese trade, Lim said he does not believe that China wants to "take any strong measures to crush the North Korean economy."
As China's trade with the North has soared, South Korea's has fallen off sharply, a victim of the undisguised contempt that Kim Jong Il's government has shown toward South Korean President Lee Myung-bak.
After Lee came into office last year, he halted a decade-old policy of giving the North unconditional gifts of food and fertilizer. North-South trade fell nearly 25 percent in the first four months of 2009, according to the Korean Customs office.
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Sunday, July 5, 2009
HINTS OF RECOVERY IN EMRGING DEBT DATA-- EMTA
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Thu Jun 11, 2009 1:45pm EDT
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By Daniel Bases
NEW YORK, June 11 (Reuters) - Emerging market debt trading volumes fell sharply in the first quarter compared to last year as investors grew cautious amid the global recession, though there are hints of a rebound in place, a new survey shows.
EMTA, a trade association for emerging markets, said on Thursday that trading volumes fell 23 percent year-on-year in the first quarter of 2009 to $915 billion. Local currency debt accounted for 72 percent of the trading volume turnover.
However, trading volumes did pick up from the fourth quarter of last year, rising 11 percent, when emerging market fixed income levels reached their lowest quarterly amount in six years.
Local market trading volumes of $656 billion were more than twice the $253 million traded in Eurobonds. Both categories however were down year-on-year, 19 percent and 30 percent, respectively.
Compared to the fourth quarter of 2008, local debt trade rose by 18 percent while Eurobond trade was roughly even the fourth quarter. EMTA surveyed 46 firms.
"I would have expected that local markets would have seen less of a recovery than was experienced in hard currency markets," said David Spegel, global head of emerging market strategy at ING and an EMTA board member based in New York.
NOTE: the global head ofb a emerging market has strategy at the ING and an EMTA board membering in the new york city.
Spegel said the rebound for local markets illustrated a robust market and countered the observed increase in local currency redemptions versus the strong recovery for the U.S. dollar.
"Investors were happy with their dollar exposure," during this period Spegel said.
Corporate Eurobond trade of $76 billion fell 33 percent year-on-year in the first quarter but surged 35 percent versus the last quarter of 2008. Trading in this sector accounted for 8 percent of overall survey volume.
Sovereign Eurobond trading of $168 billion made up 18 percent of the total volume in the first quarter.
Brazil maintained its top rank as the country with the biggest volume share of debt traded at 19 percent, followed by Turkey with 15 percent and China with 10 percent in the first quarter.
© Thomson Reuters 2009 All rights reserved
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Hints of recovery in emerging debt data-EMTA
Thu Jun 11, 2009 1:45pm EDT
Email | Print |
Share
| Reprints | Single Page
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Market News
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By Daniel Bases
NEW YORK, June 11 (Reuters) - Emerging market debt trading volumes fell sharply in the first quarter compared to last year as investors grew cautious amid the global recession, though there are hints of a rebound in place, a new survey shows.
EMTA, a trade association for emerging markets, said on Thursday that trading volumes fell 23 percent year-on-year in the first quarter of 2009 to $915 billion. Local currency debt accounted for 72 percent of the trading volume turnover.
However, trading volumes did pick up from the fourth quarter of last year, rising 11 percent, when emerging market fixed income levels reached their lowest quarterly amount in six years.
Local market trading volumes of $656 billion were more than twice the $253 million traded in Eurobonds. Both categories however were down year-on-year, 19 percent and 30 percent, respectively.
Compared to the fourth quarter of 2008, local debt trade rose by 18 percent while Eurobond trade was roughly even the fourth quarter. EMTA surveyed 46 firms.
"I would have expected that local markets would have seen less of a recovery than was experienced in hard currency markets," said David Spegel, global head of emerging market strategy at ING and an EMTA board member based in New York.
NOTE: the global head ofb a emerging market has strategy at the ING and an EMTA board membering in the new york city.
Spegel said the rebound for local markets illustrated a robust market and countered the observed increase in local currency redemptions versus the strong recovery for the U.S. dollar.
"Investors were happy with their dollar exposure," during this period Spegel said.
Corporate Eurobond trade of $76 billion fell 33 percent year-on-year in the first quarter but surged 35 percent versus the last quarter of 2008. Trading in this sector accounted for 8 percent of overall survey volume.
Sovereign Eurobond trading of $168 billion made up 18 percent of the total volume in the first quarter.
Brazil maintained its top rank as the country with the biggest volume share of debt traded at 19 percent, followed by Turkey with 15 percent and China with 10 percent in the first quarter.
© Thomson Reuters 2009 All rights reserved
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Pedestrians walk past a Bank of America branch in New York May 8, 2009. REUTERS/Lucas Jackson
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3. Asian shares advance; momentum seen waning
4. U.S. kills Northrop Grumman missile-defense program
5. UK Stocks -- Factors to watch on June 12
6. UPDATE 2-Citigroup sells $1 bln in debt without US guarantee
7. HK shares hit 9-mnth high; China stocks slip
8. Microsoft V. Google: Two Opposite Approaches To Browser Advertising
9. As crisis bites elsewhere, Indian firms turn to China
10. UPDATE 1-US lawmaker: BofA's Lewis inconsistent
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Soros says CDS are destructive, should be outlawed
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Saturday, July 4, 2009
AUSTRILIAN, N.S DOLLAR FALL ON FEED PURCHASE REPORT.
JANE BRYANT QUINNJOHN DORFMANPORTFOLIO TRACKERCALCULATORSFINANCIAL GLOSSARY
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By Candice Zachariahs
June 12 (Bloomberg) -- The Australian and New Zealand dollars fell against the U.S. currency, paring this week's gains, on speculation the Federal Reserve will let yields climb rather than boosting purchases of U.S. bonds.
The currencies weakened as the Wall Street Journal reported the Fed will probably maintain its current level of purchases of Treasuries and mortgage-backed securities when it meets in late June, without saying where it got the information. The Australian and New Zealand dollars headed for a fourth weekly advance against the yen as traders raised bets the countries' central banks will boost rates within a year.
"We may be approaching a tipping point in U.S. yields and energy prices and once we get there prospects for the global economic recovery may start to be harmed," said Robert Rennie, chief currency strategist at Westpac Banking Corp. in Sydney. "Parts of the global economy are facing increasing headwinds and the arguments for a correction in risky currencies are rising."
NOTE: the autrilian and new zealand dollars headed for afourth weekly advace aganst the yen as traders raise bets the countrys'
Australia's currency fell 0.9 percent to 81.17 U.S. cents as of 5:37 p.m. in Sydney and has gained 2.3 percent this week. The currency touched 80.27 yen today, near the most since Oct. 6, before trading at 79.49 yen.
New Zealand's dollar slipped 0.4 percent to 64.04 U.S. cents today and also advanced 2.3 percent since trading at 62.64 cents in New York on June 5. The currency added 1.5 percent this week against the yen to 62.73 yen.
The Australian dollar may trade at 77 U.S. cents by month- end, while New Zealand's currency may fall toward 60 cents, Rennie said.
Rapid Gains
"The Aussie's had a fairly positive week and everyone is looking for a pull-back," said Charles Wiggins, corporate risk manager at Custom House Global Foreign Exchange in Sydney. "If the Aussie continues to fall, you'd be looking back down towards the 80.80 and then 80.30-cent region."
New Zealand's retail sales rose for the second time in three months in April. Sales gained 0.5 percent from March, seasonally adjusted, Statistics New Zealand said in Wellington today. The median estimate in a Bloomberg News survey of nine economists was for a 0.2 percent gain.
Interest Rates
Bets on interest-rate increases rose yesterday after Australia lost fewer jobs than expected and Reserve Bank of New Zealand Governor Alan Bollard said his country's economy would start to recover toward the end of the year.
The Reserve Bank of Australia will add 70 basis points to its benchmark over the next 12 months, while Bollard will boost borrowing costs by 66 points, according to separate Credit Suisse indexes. A basis point is 0.01 percentage point.
"This notion that the worst of the global recession is behind us is adding to risk appetite and lending support to risk proxies like the Aussie and kiwi particularly against low- yielding currencies," said Sue Trinh, a senior currency strategist at RBC Capital Markets in Sydney. "There's increasing evidence these central banks are close to or at the end of their easing cycles."
Benchmark interest rates are 3 percent in Australia and 2.5 percent in New Zealand, compared with 0.1 percent in Japan and as low as zero in the U.S.
Australia today sold A$699 million ($571.3 million) of debt maturing June 2011 at a weighted average yield of 4.01 percent. The so-called bid-to-cover ratio at the auction was 3.4.
Australian government bonds advanced. The yield on 10-year notes fell 10 basis points, or 0.10 percentage point, to 5.54 percent, according to data compiled by Bloomberg. The price of the 5.25 percent security due March 2019 rose 0.735, or A$7.35 per A$1,000 face amount, to 97.83.
New Zealand's two-year swap rate, a fixed payment made to receive floating rates, fell to 3.86 percent after climbing to 3.98 percent yesterday, the most since March 30.
To contact the reporter on this story: Candice Zachariahs in Sydney at czachariahs2@bloomberg.net
Last Updated: June 12, 2009 03:52 EDT
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By Candice Zachariahs
June 12 (Bloomberg) -- The Australian and New Zealand dollars fell against the U.S. currency, paring this week's gains, on speculation the Federal Reserve will let yields climb rather than boosting purchases of U.S. bonds.
The currencies weakened as the Wall Street Journal reported the Fed will probably maintain its current level of purchases of Treasuries and mortgage-backed securities when it meets in late June, without saying where it got the information. The Australian and New Zealand dollars headed for a fourth weekly advance against the yen as traders raised bets the countries' central banks will boost rates within a year.
"We may be approaching a tipping point in U.S. yields and energy prices and once we get there prospects for the global economic recovery may start to be harmed," said Robert Rennie, chief currency strategist at Westpac Banking Corp. in Sydney. "Parts of the global economy are facing increasing headwinds and the arguments for a correction in risky currencies are rising."
NOTE: the autrilian and new zealand dollars headed for afourth weekly advace aganst the yen as traders raise bets the countrys'
Australia's currency fell 0.9 percent to 81.17 U.S. cents as of 5:37 p.m. in Sydney and has gained 2.3 percent this week. The currency touched 80.27 yen today, near the most since Oct. 6, before trading at 79.49 yen.
New Zealand's dollar slipped 0.4 percent to 64.04 U.S. cents today and also advanced 2.3 percent since trading at 62.64 cents in New York on June 5. The currency added 1.5 percent this week against the yen to 62.73 yen.
The Australian dollar may trade at 77 U.S. cents by month- end, while New Zealand's currency may fall toward 60 cents, Rennie said.
Rapid Gains
"The Aussie's had a fairly positive week and everyone is looking for a pull-back," said Charles Wiggins, corporate risk manager at Custom House Global Foreign Exchange in Sydney. "If the Aussie continues to fall, you'd be looking back down towards the 80.80 and then 80.30-cent region."
New Zealand's retail sales rose for the second time in three months in April. Sales gained 0.5 percent from March, seasonally adjusted, Statistics New Zealand said in Wellington today. The median estimate in a Bloomberg News survey of nine economists was for a 0.2 percent gain.
Interest Rates
Bets on interest-rate increases rose yesterday after Australia lost fewer jobs than expected and Reserve Bank of New Zealand Governor Alan Bollard said his country's economy would start to recover toward the end of the year.
The Reserve Bank of Australia will add 70 basis points to its benchmark over the next 12 months, while Bollard will boost borrowing costs by 66 points, according to separate Credit Suisse indexes. A basis point is 0.01 percentage point.
"This notion that the worst of the global recession is behind us is adding to risk appetite and lending support to risk proxies like the Aussie and kiwi particularly against low- yielding currencies," said Sue Trinh, a senior currency strategist at RBC Capital Markets in Sydney. "There's increasing evidence these central banks are close to or at the end of their easing cycles."
Benchmark interest rates are 3 percent in Australia and 2.5 percent in New Zealand, compared with 0.1 percent in Japan and as low as zero in the U.S.
Australia today sold A$699 million ($571.3 million) of debt maturing June 2011 at a weighted average yield of 4.01 percent. The so-called bid-to-cover ratio at the auction was 3.4.
Australian government bonds advanced. The yield on 10-year notes fell 10 basis points, or 0.10 percentage point, to 5.54 percent, according to data compiled by Bloomberg. The price of the 5.25 percent security due March 2019 rose 0.735, or A$7.35 per A$1,000 face amount, to 97.83.
New Zealand's two-year swap rate, a fixed payment made to receive floating rates, fell to 3.86 percent after climbing to 3.98 percent yesterday, the most since March 30.
To contact the reporter on this story: Candice Zachariahs in Sydney at czachariahs2@bloomberg.net
Last Updated: June 12, 2009 03:52 EDT
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