ecglcd

  Asian currencies rose slightly on Friday as they recovered from a series of bruising sessions, with sentiment remaining constrained after hawkish signals from the Federal Reserve drummed up fears of more rate-hike action by the central bank. China’s yuan was among the best performers in the region, rising 0.4%. But the currency was set to lose about 0.3% this week as concerns over rising COVID-19 cases and softening economic growth weighed. The Japanese yen rose 0.2% as data showed consumer inflation surged to a 40-year high in October. The reading, which heralds increasing pressure on the Japanese economy, drove speculation that the Bank of Japan may be forced into eventually tightening monetary policy. The bank has maintained ultra-low interest rates for the better part of a decade, and has so far given no indication that it plans to raise them. But this has also caused a sharp decline in the yen this year, as rising interest rates in other countries saw traders sell the yen in...

  The U.S. dollar traded in a tight range in early European trading Thursday ahead of the release of widely-watched U.S. inflation data, while sterling edged lower ahead of the potential end of the Bank of England's emergency bond-buying program. At 03:00 ET (07:00 GMT), the Dollar Index, which tracks the greenback against a basket of six other currencies, edged 0.1% higher to 113.332, remaining close to a 20-year peak. The dollar remains in demand after minutes of the central bank’s September meeting showed on Wednesday that policymakers unanimously agreed on the need for more monetary tightening to combat inflation. “This is the narrative that is keeping the general trend in risk assets bearish and the dollar supported, and we do not expect it to change until 1Q23 at the earliest,” said analysts at ING, in a note. The main focus Thursday will be on the release of the latest U.S. inflation data, which is expected to show that annual CPI inflation remained above 8% in September, re...

  Japan is ready to take "decisive" action against rapid yen declines and is focusing on volatility rather than levels in deciding whether to intervene again, Finance Minister Shunichi Suzuki said. Suzuki said he told his G7 and G20 counterparts that Japan was "deeply worried about sharply rising volatility" in the currency market. "We cannot tolerate excessive volatility in the currency market driven by speculative moves. We're watching currency moves with a strong sense of urgency," Suzuki told reporters on Wednesday after attending the G7 finance leaders' meeting in Washington. "It's not as if we have a specific (dollar/yen) level in mind. Instead, we're looking at volatility." Japan intervened in the currency market last month to arrest sharp yen falls, driven largely by the policy divergence between aggressive U.S. interest rate hikes and the Bank of Japan's resolve to keep monetary policy ultra-loose. Markets are focusin...

  Ecglcd：India's RBI may need to tap old ways to boost forex reserves - economists The Reserve Bank of India may have to resort to tried and tested measures to shore up its foreign exchange reserves, including encouraging non-resident Indians to deposit more funds, as it looks to stabilise a steadily declining rupee, economists said. The Indian currency has weakened 9.5% so far this year, with the central bank defending the rupee via dollar sales that depleted its forex reserves to $545 billion from the peak $642 billion a year ago. "The central bank should intervene to ensure that a falling currency does not eclipse India's fundamentals," Abheek Barua, chief economist at HDFC Bank, wrote in a note this week. While there might be some benefits of a depreciated currency in closing the trade gap, the damage to the capital account in terms of reduced confidence of investors will outweigh it, he added. According to Barua, the central bank may need to think of ways to bulk...

  Ecglcd：Pound Rises as BoE's Pill Says Fiscal News Needs "Significant" Policy Response The U.K. government's new package of unfunded tax cuts will most likely require higher interest rates, a top Bank of England official said on Wednesday. The outlook for the U.K. has changed abruptly in the wake of Kwasi Kwarteng's so-called 'mini-budget', Reuters reported the Bank's chief economist Huw Pill as saying, adding that it's "hard not to draw conclusions that we will need (a) significant monetary policy response." The comments come a day after the worst volatility seen in U.K. foreign exchange and bond markets in over a decade, as investors dumped the pound and U.K. government bonds on fears that Kwarteng's plans would cause inflation and put U.K. public finances on an unsustainable trajectory. The volatility had forced the Bank to issue a statement saying it would tighten monetary policy "as much as necessary" to bring inflatio...

  Japan may seem like a lonely voice in the Group of Seven pleading for some currency calm, but the rest may be taking more notice than first appears. Nearly every other economic and political metric these days seems to have returned to the 1980s - so thoughts of significant G7 currency market intervention seem less outlandish against that backdrop. The U.S. dollar's index has only recorded year-on-year gains at the current 20% pace on four other occasions since its historic surge in 1985 prompted the then G5 powers to collectively intervene to cap the rampant greenback. Those four extreme dollar surges came during the early 1990s European exchange rate crises; the euro's swoon in 2002/2001 after the launch of the single currency; the aftermath of 2008's banking bust; and the oil collapse of early 2015. At least two of those moments involved some form of G7 or G20 action to calm the horses. Is there a case for it to happen again? Reinvigorated as an effective governing coun...

  Most Asian currencies fell on Friday, with China’s yuan slipping past an important psychological level as concerns over rising interest rates and a potential recession dented appetite for regional assets. The yuan slipped 0.2%, crossing the 7 level against the dollar for the first time in over two years, as investors continued to fret over slowing growth in the world’s second-largest economy. Data on Friday showed Chinese house prices marked their worst monthly drop in nearly seven years, falling 1.3% in August. China’s debt-saddled property market accounts for a bulk of its economic growth, and has come under extreme pressure from a cash crunch this year. The weak data offset other readings that showed bigger-than-expected growth in Chinese retail sales and industrial production in August. A series of COVID-related lockdowns ground Chinese economic activity to a halt this year, pressuring the yuan. This spurred several stimulus measures by the government to shore up growth, whic...