Currency: Kiwi settles lower
Posted on April 30, 2008 in ()
Currency: Kiwi settles lower
The New Zealand dollar slipped further today as most currencies awaited important US data for direction.
US GDP (gross domestic product) figures are due out overnight, as are the latest interest rate decision by the US Federal Reserve.
At 5pm the New Zealand dollar was at US77.66c, down from US78.22c last night. It also slipped against the yen at 80.70 yen (81.54 yen yesterday) and euro at 0.4981 (0.5000) and languished against the stronger Australian dollar at A83.11c (A83.55c).
ANZ Institutional Bank senior dealer Mark Elliott said trading volumes had been moderate ahead of the US moves, which would probably be "quite defining" for currency markets over the next month or so.
There had been some selling pressure on the kiwi dollar near its lows of US77.26c today, "but it seems to have held up".
Against the Aussie dollar, the kiwi briefly fell through a key support level of A83c.
A break through the previous low of A82.50c in October last year could herald a "significant move" lower, Mr Elliott said.
But all eyes were really on the "Fed" which was expected to make another quarter per cent cut but possibly signal an end to its easing cycle.
" Technically the US stock market look vulnerable to another fairly large selloff. Now whether that translates into US dollar weakness or carry trade weakness, it really is impossible to tell at this point," Mr Elliott said.
The trade weighted index was 69.43 from 69.84 at 5pm yesterday.
Currency rates:
NZ dlr/US dlr US77.64c US78.22c
NZ dlr/Aust dlr A83.10c A83.55c
NZ dlr/euro 0.4981 0.5000
NZ dlr/yen 80.70 81.54
NZ dlr/stg 39.45p 39.32p
NZ TWI 69.34 69.84
Australian dollar US93.45c US93.68c
Euro/US dollar 1.5584 1.5652
US dollar/yen 103.94 104.22Mideast economies 'less vulnerable'
Posted on April 30, 2008 in ()
Mideast economies 'less vulnerable'
Middle East economies are unlikely to suffer from the global credit crisis to the same degree as the West because of ample regional liquidity.
That is the view expressed by Central Bank of Bahrain Governor Rasheed Al Maraj in an interview in the forthcoming 'The Report: Bahrain 2008,' the latest edition of the business guide to be published by Oxford Business Group.
He said that the question about whether regulators should have taken pre-emptive measures to mitigate the effects of the credit crunch had come up on many occasions.
'My position is that regulators cannot micro-manage the investment portfolios of banks,' he said.
'We are focused on making sure that licensed institutions adhere to regulations.
'If licensees take risks that are contrary to their prudential limits, that burden cannot be put on the regulator. It is the responsibility of the bank's management and board of directors. Each business must be managed and run according to the decisions made by institutions.'
'By the end of last year, affected institutions in Bahrain disclosed their exposure and they have taken measures to rectify the problem since,' he said.
'The wider implications of the credit crunch are more than likely to affect local banks, especially as a number of leading global institutions have been severely affected.
'However, unlike Western economies, economies in this region have ample liquidity at hand due to high oil prices so I feel we are not as likely to suffer from credit worries.GCC, Egypt, Jordan GDP to top $1 trillion
Posted on April 30, 2008 in ()
GCC, Egypt, Jordan GDP to top $1 trillion
The combined GDP of the GCC economies, together with Egypt and Jordan, will cross $1,045 billion in 2008, thereby sustaining the region’s demand for white goods and consumer electronics, according to an industry research.
The strong growth of Middle East economies at a rate of 6.5 per cent annually is fueled mainly by the continuing high oil prices.
“The strong economic growth is also intensified by the real estate boom across countries in the Middle East that continues unabated and translates into huge opportunity for appliance manufacturers,” said Eckhard Pruy, CEO of Epoc Messe Frankfurt, organisers of International CES/hometech.
“In the Gulf Cooperation Council (GCC) countries, investment spending will expand to at least $800 billion over the next five years, with major projects in the oil and gas sectors, infrastructure, and real estate,” he said.
Morgan Stanley estimates that GDP for the GCC plus Egypt and Jordan will reach $1,045 billion in 2008, more than twice the 2002 figure of $484 billion.
“Industry estimates reveal that, due to the unabated growth in real estate development and spending across the Middle East, the volume of new office space in Dubai will increase from 1.6 million sq m presently to 5.6 million sq m in 2009,’ said Mehtap Kenar, senior show manager, International CES/hometech.
“Construction of huge new megamalls and expansion of the current megamalls are also planned. Similarly, in Doha, capital and port city in Qatar, more than 16,000 new apartments will be available by 2010, while retail space availability is also set to increase - from 450,000 to 1.13 million sq m between 2007 and 2012. Riyadh is also witnessing huge investments in retail space,” he said.
Pruy noted that: “Given the urge to splurge in the region appliance manufacturers can expect to boost their sales volumes in 2008.”
International CES/hometech Middle East, to be held from May 25-27,2008 at the Dubai International Convention and Exhibition Centre, is a successful platform for the Gulf states, the wider Middle East, North and East Africa, the CIS and the Indian Subcontinent, to source the latest in home technology, home entertainment, home automation, home appliances and domestic devices.
The UAE and Dubai in particular, is among the leading markets for consumer electronics products in the Middle East. Dubai also features as the prime distribution centre for regional electronics sales. Industry analysts believe the surge in sales of electronics products in and through Dubai is due to competitive prices. With diversification of import sources and introduction of new products, huge demand in the Middle East has arisen, giving a new dimension to the scale of supply required.
At International CES/hometech in 2008, professionals will witness the latest trends in home networking, wireless and mobile technology, audio technology, home entertainment, gaming, home appliances and ‘In-car’ technology. Industry experts believe that the prolific product profile of the event will mark it as the most important technology event of the Middle East. The exhibition area on which participants will exchange information and opinions on technologies in IT and consumer electronics will double compared to last year.Dollar to recover in six months: Mubadala
Posted on April 30, 2008 in ()
Dollar to recover in six months: Mubadala
The United Arab Emirates made the right choice in keeping its dirham pegged to the ailing US dollar and it fully expects the greenback to recover this year, the head of a state-controlled investment firm said in remarks published on Wednesday.
"We had good days with the dollar and were happy. I think the decline of the dollar will not continue and it will recover within six months," said Khaldoon al-Mubarak, chief executive of Mubadala Development Co, an Abu Dhabi investment vehicle that manages over $10 billion in assets.
His comments were published in the Emirates Business daily newspaper.
Pressure on the UAE and most of its Gulf neighbours to revalue their currencies mounted as the dollar tumbled to record lows against the euro this year, driving up import costs, and the states tracked six US interest rate cuts since September.
UAE Prime Minister Sheikh Mohammed bin Rashid al-Maktoum dampened speculation that the oil producer might reform its currency policy when he accepted a committee's proposal this month to maintain the dirham's dollar link at the same rate.
Mubadala is one of the agencies Abu Dhabi and other members of the UAE federation use to invest their windfall from a five-fold increase in oil prices since 2002.
In comments to another newspaper on Wednesday, Al-Mubarak said the UAE is outlining a strategy to tackle near-record inflation and would announce measures in the coming weeks.
"The impact of inflation is a major challenge facing the economy and the government is giving priority to tackling the situation," he told the Khaleej Times.
"The rise in cost of doing business has emerged as a serious issue and what I can assure you is that the matter is being studied and deliberated upon by the federal government," he said.
The Ministry of Economy has been trying to control food price inflation, for instance, by having various supermarket chains fix the prices of basic food items.
Inflation in the second-largest Arab economy hit a 19-year peak of 9.3 percent in 2006 and probably accelerated to 10.9 percent last year, according to an estimate by the National Bank of Abu Dhabi.The Risk Today:
Posted on April 30, 2008 in ()
The Risk Today: