Dollar Loses Again Against Euro Yen and Australian

(Best Syndication News) The euro has been rising from last week’s four- year lows and today it rose again (see charts below). The dollar lost against the euro, the yen and the Australian dollar.

Euro Dollar Exchange Rates

The euro was up .422 percent against the British pound and .674 percent against the Japanese yen.
The euro was trading at $ 1.2323 today, up .86 percent according to our first survey of the day (see the results of other surveys below). Stock markets around the world were higher as investors moved money into riskier assets.
The DJIA was up over 200 points today while the Nikkie 225 was up 8.04 points (.08 %) to 9,887.89. The Australian S&P ASX 200 was one of the few markets lower today losing .5 points (.01 %) to 4,505.00.
Confidence was spreading today as Spain sold their sovereign debt despite the trend to riskier investments. Reports suggested that Spain would require a bailout similar to Greece, but analysts are quick to point out differences. German officials said Spain was not likely on the next EU summit agenda.
Spain was able to raise 5.2 billion euros in 12 and 18-month T-bills at auction. They are paying a significantly higher average yield than last month, but the sale reassured investors that they will be able to meet their debt redemption at the end of July.
Rising stock markets pulled money away from the German bonds Monday. The German 10-year yields rose seven basis points to 2.64 percent and it was announced that industrial production in the EU grew 0.8 percent in April from March.

Australian Dollar

The euro gained against all other major currencies except the Australian dollar. The Aussie was up seven of the last ten days. The Australian dollar was up .9 percent against the U.S. dollar and .822 percent against the Canadian. See the cross table below for more details.
By: Steven Potter
Business Reporter

Friday	Monday	Tuesday	Survey # 1	% Change Day	% Change Wk
6/11/2010	6/14/2010	6/15/2010	Per Dollar	Pos=$US Gain	Pos=$US Gain
7.7938	7.7917	7.7906	Hong Kong Dollar - HKD	0.01	0.16
1.1803	1.1665	1.1559	Australian Dollar - AUD	0.91	4.30
1.0372	1.0343	1.0258	Canadian Dollar - CAD	0.82	1.80
1.1538	1.1423	1.1334	Swiss Franc - CHF	0.78	1.30
0.6884	0.6785	0.6756	British Pound - GBP	0.43	1.79
91.64	91.591	91.42	Japanese Yen - JPY	0.19	0.14
0.8291	0.8185	0.8115	Euro - EUR	0.86	2.74
14.9032	14.8890	14.8590	Average	0.20	0.00
6/11/2010	6/14/2010	6/15/2010	Dollar /	Pos=$US Loss	Pos=$US Loss
0.1283	0.1283	0.1284	Hong Kong Dollar - HKD	0.01	0.16
0.8472	0.8573	0.8651	Australian Dollar - AUD	0.92	4.49
0.9641	0.9668	0.9748	Canadian Dollar - CAD	0.83	1.83
0.8667	0.8754	0.8823	Swiss Franc - CHF	0.79	1.31
1.4526	1.4738	1.4802	British Pound - GBP	0.43	1.82
0.0109	0.0109	0.0109	Japanese Yen - JPY	0.19	0.14
1.2061	1.2217	1.2323	Euro - EUR	0.86	2.82
8:30 AM	2:40 PM	2:30 PM	Time Collected (Pacific)
Fri	Monday	Tuesday	Survey # 2	% Change Day	% Change Wk
6/11/2010	6/14/2010	6/15/2010	Per Dollar	Pos=$US Gain	Pos=$US Gain
91.74312	91.74312	91.74312	JPY ¥ Yen	0.00	0.92
0.82919	0.81880	0.81129	EUR € Euro	0.92	2.79
1.03724	1.03125	1.02564	CAD $ Canadian	0.54	1.64
0.68842	0.67870	0.67558	GBP £ British	0.46	1.82
1.18064	1.16604	1.15513	AUD $ Australia	0.94	4.41
1.15300	1.14286	1.13366	CHF Swiss Franc	0.80	1.28
16.10527	16.09679	16.09074	Average	0.04	0.74
6/11/2010			Dollar /	Pos=$US Loss	Pos=$US Loss
0.0109	0.0109	0.0109	JPY ¥ Yen	0.00	0.91
1.206	1.2213	1.2326	EUR € Euro	0.93	2.87
0.9641	0.9697	0.975	CAD $ Canadian	0.55	1.67
1.4526	1.4734	1.4802	GBP £ British	0.46	1.85
0.847	0.8576	0.8657	AUD $ Australia	0.94	4.62
0.8673	0.875	0.8821	CHF Swiss Franc	0.81	1.30
8:30 AM	3:00 PM	2:50 PM	Time Collected (Pacific)
Friday	Monday	Tuesday	Survey # 3
6/11/2010	6/14/2010	6/15/2010	Per Dollar	% Change Day	% Change Wk
			Americas	Pos=$US Gain	Pos=$US Gain
3.9165	3.9205	3.9175	Argentinean Peso	0.08	0.05
1.8063	1.8001	1.7995	Brazilian Real	0.03	3.56
1.036	1.0312	1.0263	Canadian Dollar	0.48	2.31
537.65	534.65	534.65	Chilean Peso	0.00	1.91
36.875	36.875	36.85	Dominican Peso	0.07	1.52
12.678	12.6369	12.6369	Mexican Peso	0.00	1.85
			Europe
0.6871	0.6786	0.6755	British Pound	0.46	2.50
21.2735	20.898	20.828	Czech Koruna	0.33	4.34
6.1409	6.0884	6.0376	Danish Krone	0.83	3.04
0.8255	0.8187	0.8116	European Euro	0.87	3.05
232	227.5	226.805	Hungarian Forint	0.31	4.52
6.4735	6.4413	6.3776	Norwegian Krone	0.99	4.30
3.3888	3.3296	3.2983	Polish Zloty	0.94	4.59
31.599	31.6605	31.66	Russian Ruble	0.00	0.44
7.9125	7.8865	7.7669	Swedish Krona	1.52	3.80
1.1495	1.1427	1.131	Swiss Franc	1.02	1.93
			Asia / Pacific Region
1.1759	1.1657	1.1578	Australian Dollar	0.68	6.16
6.8355	6.83	6.837	Chinese Yuan Renminbi	0.10	0.05
7.7905	7.7909	7.7913	Hong Kong Dollar	0.01	0.15
46.825	46.54	46.355	Indian Rupee	0.40	1.82
9,250.00	9,180.00	9,167.50	Indonesian Rupiah	0.14	1.82
91.655	91.635	91.475	Japanese Yen	0.17	0.14
3.285	3.2525	3.259	Malaysian Ringgit	0.20	2.21
1.4481	1.4398	1.4351	New Zealand Dollar	0.33	5.39
85.3	85.3	85.45	Pakistani Rupee	0.18	0.35
1.4028	1.3968	1.3937	Singapore Dollar	0.22	1.69
1,250.60	1,250.60	1,222.25	South Korean Won	2.27	0.31
32.315	32.25	32.29	Taiwanese Dollar	0.11	0.60
32.54	32.375	32.41	Thai Baht	0.11	0.70
			Africa / Middle East
5.6765	5.677	5.677	Egyptian Pound	0.00	0.11
3.848	3.819	3.822	Israeli Shekel	0.08	1.65
7.6818	7.6787	7.5931	South African Rand	1.11	2.18
1.5788	1.5697	1.5697	Turkish New Turkish Lira	0.00	2.17
3.673	3.6729	3.6729	UAE Dirham	0.00	0.00

Averages:

Average	Average	Average	From Survey 1 - 3	% Change Day	% Change Wk
6/11/2010	6/14/2010	6/15/2010	Currency / $US	Pos=$US Gain	Pos=$US Gain
1.1789	1.1661	1.1563	Average Against Aussie	0.84	5.20
0.8279	0.8187	0.8115	Average Against Euro	0.88	3.05
91.6794	91.6564	91.5460	Average Against Yen	0.12	0.09

Cross Chart:

Pos Means Top Currency Gained				One Day Change		June 15th 2010  2:30 PM
Survey # 1	HKD	AUD	CAD	CHF	GBP	JPY	EUR	USD
HKD		0.903%	0.812%	0.768%	0.424%	0.118%	0.850%	-0.014%
AUD $	-0.868%		-0.089%	-0.127%	-0.471%	-0.787%	-0.056%	-0.909%
CAD	-0.754%	0.090%		-0.044%	-0.387%	-0.885%	0.040%	-0.822%
CHF	-0.750%	0.133%	0.045%		-0.339%	-0.800%	0.079%	-0.779%
GBP £	-0.459%	0.481%	0.381%	0.337%		0.000%	0.422%	-0.427%
JPY ¥	-0.174%	0.727%	0.637%	0.594%	0.250%		0.674%	-0.187%
EUR €	-0.762%	0.043%	-0.038%	-0.084%	-0.415%	0.000%		-0.855%
USD	0.078%	0.921%	0.827%	0.788%	0.434%	0.000%	0.868%

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here are many types of forex brokers in the market. Knowing them is very important, especially if you are new to foreign currency trading.  This will help you weed out fraudulent or illegitimate brokers from the professionals. Also, different brokers have different styles of doing business in this type of market. It is important to choose the right kind of broker that will help you feel comfortable with your trading decisions. Foreign currency brokers are largely classified by their trading styles and market access.
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Euro selling resumes after Greece downgrade

une 15 (Reuters) - The euro retreated on Tuesday as as downgrade of Greece's debt to junk status by ratings agency Moody's renewed concerns about euro zone debt, dampening sentiment and cutting short a rally in the currency.

Moody's slashed Greece's rating by four notches, citing "macroeconomic and implementation risks" in the country's draconian austerity programme and renewing persistent doubts about Greece's ability to repay its debt.

Worries about Spain also increased as Spanish Treasury Secretary Carlos Ocana acknowledged on Monday that some Spanish banks faced a liquidity freeze in the interbank market.

This put a stop to the euro's impressive run over the past few sessions when a rally in equity markets prompted investors to take profits on hefty short positions, leading the single currency to stall just shy of resistance at around $1.23.

"Yesterday we had concerns about Spain and on top of that the Greece downgrade and that is weighing on the euro now," said Johan Javeus, currency strategist at SEB in Stockholm.

"The Greece downgrade highlighted that these problems are quite severe and it is difficult to see the liquidity problems in Spain improving and I think the euro will struggle going forward".

SEB technical analysts said, however, that $1.2045 should provide solid support for the euro. That level is close to lows hit on Friday before the currency's solid rally on Monday when it rose close to $1.23.

The euro on Monday closed above its 14 day moving average for the first time since mid-April.

At 0717 GMT, the euro was down 0.3 percent against the dollar at $1.2182.

The Australian dollar fell 0.7 percent to $0.8522, pulling back from Monday's one-month high as greater risk aversion caused investors to cut exposure to higher-yielding currencies.

Minutes of an Australian central bank meeting that said interest rates could be left on hold in the near term also hit the Aussie. Policymakers expressed concerns about the debt problems in the euro zone.

STALLING RALLY

Yield spreads between peripheral euro zone government bonds and core German Bunds widened on Tuesday after the Greece downgraded and traders said the market looked vulnerable to euro negative news.

"Whether the bounce in the euro from $1.19 to $1.22 is more than a brief relief bounce remains open for debate but the sharp reaction to the rating downgrade overnight suggests that sentiment is still extremely fragile," Matthew Strauss, senior currency strategist at RBC Capital wrote in a note.

Traders said any revival in risk appetite may check losses in the near term, however.

Resistance is still around a Fibonacci retracement level at $1.2301, which is 23.6 percent of the euro's move from an April 14 high to its June 7 low.

The euro fell 0.7 percent on the yen to 111.01 yen. The U.S. dollar lost 0.4 percent to 91.16 yen.

In the options market, the recent rebound in euro/yen and Aussie/yen was reducing the attraction of yen calls and prompting investors to dump options since euro/yen failed to break below a barrier at 108 yen last week, traders said.

Dollar Weakens As Nerves Subside 

  LONDON (Dow Jones)--The dollar sank in European trading hours Monday as generally brighter investor sentiment trimmed demand for what's seen as a safe currency to hold in times of stress.

The euro shot higher, breaking above points of technical resistance against the U.S. currency, as somewhat improved sentiment alongside the lack of any fresh negative news on euro-area banks and finances prompted some traders to scale back negative bets.

Data showing a record 9.5% rise in annual euro-zone industrial output during April also helped the move, with the single currency shooting to over $1.2230--a 1% rise from the lowest point of the day.

"April's sharp rise in euro-zone industrial output indicates that the recovery in the export-sensitive industrial sector has been little affected so far by the region's fiscal woes," said ING economist Martin van Vliet.

Broadly upbeat sentiment in global financial markets also supported the rise in the 16-country currency, which was echoed by modest weakness in so-called safe haven currencies, among them the yen and the Swiss franc, which tend to perform best when investors are nervous.

"No news is good news for the euro," said currency analysts at Commerzbank in Frankfurt. "[As long as] the issue of peripheral country bonds goes well, and as long as the European Central Bank does not commit any massive communication errors, the euro has potential for recovery," they said, adding that this trend is also likely to continue pushing the yen lower.

See the euro's performance against the dollar here:

http://www.dowjoneswebservices.com/chart/view/4128

Sterling also moved higher, as nerves stabilized and a new independent government department cut the country's borrowing forecasts. The Office for Budget Responsibility said that the U.K. will need to borrow GBP106 billion in 2012 to 2013, from GBP110 billion seen earlier.

In addition, a weekend newspaper article by Bank of England monetary policy committee member, Andrew Sentance, hinted that higher interest rates may be needed sooner than expected to fight persistent inflation. That provided the pound with fuel for a modest rise against both the dollar and the euro.

With no clear positive catalyst, rises in riskier currencies and weakness in the yen may not last long, analysts said. However, it may continue as a robust short-term trend, particularly as measures of speculative bets also point to some dollar weakness from current levels.

Data Friday from the Commodity Futures Trading Commission showed that negative bets on the euro had again approached a record high in the week up to June 8, while positive bets on the dollar had hit an all-time high.

Such extremes in positioning raise risks, analysts warned. "The fact that the data revealed net aggregate long dollar positions reached an all-time high last week, highlights the potential for profit-taking this week," said Mitul Kotecha, chief currency analyst at Credit Agricole in Hong Kong in a note to clients.

Overnight in Asia, the Korean won showed little reaction to the widely-expected capital controls that were introduced in the country over the weekend.

In European emerging markets, there were small gains for the Hungarian forint and the Polish zloty, in a move attributed to improving general sentiment. The euro dropped from almost HUF282 to around HUF280 over London trading hours.

At 0922 GMT, the euro was trading at $1.2235, up from $1.2077 late in New York Friday, according to trading system EBS. The dollar was a shade higher at Y91.91 against the yen, from Y91.62, while the euro was up at Y112.45 from Y110.65. The U.K. pound was higher at $1.4731 from $1.4516.

The ICE Dollar Index, which tracks the greenback against a trade-weighted basket of currencies, was down at 86.566 from 87.508.

Forex kitty shrinks by $1.4 bn on global currency volatility

The volatility in the global currency markets on account of the sharp dip in the euro vis-à-vis the dollar has led to the value of India’s foreign exchange reserves eroding by $1.4 billion last week. In addition, foreign portfolio investors also pulled out dollars from the local markets.

The country’s forex reserves dipped $ 1.4 billion in the week ended May 28, largely due to revaluation of non-dollar assets and some sell-off by foreign investors. The reserves are at almost $272 billion. Foreign currency assets comprising dollars, British pounds and euro, among others, dipped $1.374 billion during the week.

The special drawing rights, or SDRs — the reserve currency with the International Monetary Fund — and the reserve capital with IMF fell $16 million and $ 4 million, respectively.

The concerns relating to sovereign debt, which were confined initially to Greece, is slowly spreading to the entire euro area. The value of euro vis-à-vis the dollar has dipped to multi-year lows, resulting in a sharp revaluation of foreign exchange reserves, said a treasury official at a public sector bank.

In the banking sector, banks still have a high exposure to mutual funds in the absence of lending opportunities during this time of the year. They parked an additional Rs 57,755 crore on an incremental basis so far (May 21) this year to take their total mutual fund (MF) exposure to Rs 1,10,175 crore.

The total stock of money comprising cash, currencies and deposits rose Rs 8,808 crore during the fortnight ended May 21 to touch Rs 56,72,224 crore as on May 21. At current levels, the annual YoY growth works out to 14.7 % against 20.9% in the year-ago period.

The government’s borrowing for the week from RBI dipped by Rs 14,124 crore during the week because of improved revenue position. Its total borrowing to meet its daily revenue mismatches amounted to Rs 7,531 crore while state governments repaid Rs 258 crore. These short-term borrowings are known as Ways and Means Advances, or WMA — a facility under which governments borrow from the central bank to meet their daily revenue mismatches. While borrowings within the limit is at the prevailing repo rate, anything above the limit is at 2 percentage points higher than the repo rate. It is common for governments to resort to such borrowings at the beginning of a fiscal until revenue flows gain momentum.

Banks cut proprietary trades in forex as volatility mounts

Banks have reduced proprietary trades in foreign exchange in view of the extreme volatility in recent days. Several treasury heads said they are squaring off their forex position by the end of the day to avoid any risk on their books. Over the past few days, the rupee has witnessed wide swings of 50 to 80 paise in a single day against dollar.

The wild swings in the exchange rate are largely because of the precipitous fall of the euro vis-à-vis the dollar. The flight of investment into the dollar has resulted in most currencies weakening against the greenback. These include even Asian currencies whose economies are outperforming those in the West.

Typically, whenever there is volatility of this scale in the rupee-dollar exchange rate, RBI begins to unload millions of dollars that it holds in its reserves. In fact, the intervention to stamp out volatility is a stated policy of the central bank. This time around, however, RBI’s intervention has been very subdued. Forex dealers said since globally the dollar is strengthening, the central bank has chosen not to intervene to support the rupee.

Overall, the local currency has depreciated from 44.92 since the beginning of this fiscal to 46.98 against dollar, a 4.5% fall against the greenback. Between its high of 44.44 on April 15 and low of 47.70 on May 25, the rupee fell 7.3%. This, dealers say, is a wide swing in the shortest span so far. On Wednesday, the rupee touched the intra-day high of 47.29 but recovered to close at 46.98. “We have been advising exporters and importers to stay away from speculation and book dollars to avoid risk in volatile period,” said the treasury head of a large commercial bank.

However, despite this, exporters who had already booked dollars in the forward contract in the April and early May are now seen cancelling these contracts and booking profits as the rupee has weakened. Importers, mainly the oil companies, had not expected such a huge drop in rupee. Traditionally, most government-owned oil companies have preferred to keep open position in the forex market. Which means that they do not enter into forward contract to buy dollars.

Most dealers feel the rupee would move in the band of 46.50 to 47.50 because of uncertainty in the overseas currency market. Also, volatility in the domestic equities market impacts the rupee movement against dollar. The rupee drops when there is a sharp fall in the equities market as foreign institutional investors sell equities and buy dollars to remit in their home country.

Rupee gains 34 paise against dollar at Rs 46.49/50

The Indian rupee shot up by 34 paise to 46.49/50 against the US dollar to extend gains for the third day on signs of capital inflows, amid the stock markets rising for the fourth day in succession.

The Indian rupee resumed higher at 46.70/71 per dollar against last weekend's level of 46.83/84 per dollar and shot up further to 46.41 per dollar before concluding at 46.49/50 per dollar.

The rupee has gained 52 paise, or 1.11 per cent, in three trading sessions against the dollar.

Dealers in forex said there was hectic demand for the rupee, with capital inflows surging. The Bombay Stock Exchange benchmark Sensex has been on a four-day gaining streak, adding 721.07 points (4.33 per cent). Today, the 30-share barometer rose 273.2 points, or 1.6 per cent, to finish at 17,338.17

Rupee at 1-week high as stocks gain

MUMBAI: The Indian rupee rose to its strongest level in more than a week on Monday boosted by sharp losses in the dollar against major units and tracking gains in the domestic stock market.

By 10:10 am the partially convertible rupee was at 46.58/59 per dollar, after hitting 46.56, its highest since June 3 and 0.55 per cent stronger than Friday's close of 46.84/85.

"Looks like a quiet day today as well. The market is still watching the euro zone for clarity but rupee could trade in a range of 46.50-46.75 today," said Vikas Chittiprolu, a senior foreign exchange dealer with state-run Andhra Bank in Mumbai.

Dealers said the inflation data due around noon would be key for providing cues on whether the central bank would be prompted to hike rates ahead of its July 27 monetary policy.

A Reuters poll showed the wholesale price index probably rose 9.56 per cent in May from a year earlier.

The performance of the stock market would also be crucial for direction as foreign fund flows influence the rupee's fortunes.

Indian shares rose more than 1 per cent with Reliance Industries leading the rise, taking cues from strong Asian markets.

Foreign funds have been net buyers of around $166 million of equities this month, after withdrawing nearly $2 billion in May as the euro zone's debt jitters hit risk appetite, pulling down the main index by 3.5 per cent and the rupee by 4.3 per cent.

Traders were also watching the dollar's moves versus majors for direction.

The index of the dollar against six major currencies was 0.6 per cent lower. Most regional currencies were stronger compared to the dollar.

The euro's short-covering rally took it briefly above $1.22 to its strongest in a week on Monday, although traders were wary about driving it too far, while the Australian dollar climbed to its highest point in four weeks.

One-month offshore non-deliverable forward contracts were quoted at 46.71, weaker than the onshore spot rate. In the currency futures market, the most traded near-month dollar-rupee contracts on the National Stock Exchange and MCX-SX were at 46.6850 and 46.6825 respectively, with the total traded volume on the two exchanges at about $980 million.