Forex Investment and Currency Trading

Iceland The Nordic central banks (Sweden, Norway and Denmark) announced on Friday that they would enter into a swap facility with the Icelandic central bank. The agreement is for up to €500mn, which gives Iceland the right to buy EUR with ISK. Riksbank Governor Ingves said that the arrangement is aimed at supporting the Iceland central bank to safeguard macro and financial stability. While the facility would not solve all the concerns, the positive news should help to restore some confidence in
Icelandic financial system. The ISK surged by almost 5% vs. the EUR after the news.
 
Hungary Wage growth slowed more [...]

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The Asian Development Bank will hold its annual meetings this weekend. The key issues addressed will include the recent rise in commodity and rice prices. Indeed, inflation in the 10 major Asian economies accelerated to 6.9% yoy in March, with food prices rising a whopping 13.5% yoy. In addition, finance ministers from South Korea, Japan and China will also discuss setting up an Asian Financial Stability Forum, similar to the Financial Stability Forum of the G7. The purpose would be to strengthen regional cooperation among the policy and financial supervisory authorities to counter instability of international financial markets.
Cross-straits trade relations [...]

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Brazil: The monetary policy committee (COPOM) hiked the overnight Selic target rate by 50bp to 11.75%. The move was a surprise to most analysts, where 25bp represented expectations. In a brief statement, COPOM clearly demonstrated a desire to be highly preemptive in its approach to restraining inflationary pressures. The decision was designed to “immediately carry out a relevant part of the adjustment of the interest rate” which would “contribute to an opportune lowering of the risk that designs the inflationary scene” and “ultimately reduce the magnitude of the total adjustment necessary.”
The decision to hike the Selic rate comes at a [...]

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South Africa Retail sales grew by 2.5% yoy in February from upward revised 0.7% in January. February gains were probably driven by the leap year effect. However, the trend in consumer demand has clearly weakened since early 2007, with the 6-month moving average at a subdued 1.0%. Retail sales will likely remain soft in the months ahead, consistent with a 4-year low consumer confidence and rising interest rates environment.
China The National Bureau of Statistics (NBS) announced that 1Q08 GDP rose by 10.6% yoy, stronger than our forecast but a moderation from 4Q07 growth at 11.2%. The NBS attributed the slower [...]

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