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China’s forex reserve growth slows for first time since 1998

January 14, 2009 by admin  
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NEW YORK (MarketWatch) — China’s foreign exchange reserve rose 27% last year to $1.95 trillion, slightly slower than the growth in reserves marked last year, state-run Xinhua new agency reported Tuesday. The increase from the end of 2007 to end of 2008 totaled $417.8 billion, down from $461.9 growth the year before and marking the first slowdown in foreign exchange growth in a decade. The report said the slowdown was a result of a shrinking trade surplus and a possible slowdown in speculative “hot-money” flows. Central University of Finance and Economics professor Guo Tianyong was quoted as saying expectations for a weaker yuan and extraction of funds from China to ease capital supply pressure in the West were major factors leading to the decrease.

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South Korea sees forex liquidity shortage easing

January 13, 2009 by admin  
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SEOUL, Jan 13 (Reuters) – South Korean Vice Finance Minister Kim Dong-soo said on Tuesday that the country’s foreign currency liquidity shortage was gradually easing.

“The foreign currency liquidity situation is gradually improving,” Kim told a vice ministerial meeting.

He also said the government would restrain rises in public service charges as much as possible to ease inflationary pressure. (Reporting by Lee Shin-hyung, Writing by Cheon Jong-woo; Editing by Jonathan Hopfner)

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Zim labour union pushes for salaries in forex

January 12, 2009 by admin  
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HARARE – The Zimbabwe Congress of Trade Unions (ZCTU) is pushing for workers to be paid in hard currency, with union leader Lovemore Matombo warning of fresh protests by workers if employers refuse to peg wages in hard currency.

Matombo, president of the ZCTU, told ZimOnline that the union’s decision making general council will meet next Saturday “to solidify our earlier position that we negotiate (new wages) in foreign currency”.

“If authorities say they have no confidence in the (local) currency who are we to have confidence in it,” said Matombo, referring to a decision by the Reserve Bank of Zimbabwe last year to allow selected shops to charge for basic commodities in American dollars.

He said: “The general council will sit on January 17 to solidify our earlier position that we negotiate in foreign currency. We have to look at what the PDL (poverty datum line or bread line) is before we discuss.

“We will discuss our next course of action but I do see workers demonstrating against price hikes in the near future, we will use our usual actions to make companies pay in foreign currency.”

With its value eroded daily by the world’s highest inflation of more than 231 million percent, the Zimbabwe dollar is nearly worthless and both consumers and traders are increasingly shunning the currency in favour of hard cash.

A collapsed currency is the most visible sign of Zimbabwe’s deepening economic and humanitarian crisis that is also seen in acute shortages of food and basic commodities, amid a cholera epidemic that has killed more than 1 700 people since last August.

Zimbabweans had hoped a power-sharing government between President Robert Mugabe and opposition leaders Morgan Tsvangirai and Arthur Mutambara would ease the political situation and allow the country to focus on reviving the collapsed economy.

The three political rivals agreed on September 15 to form an all-inclusive government under a power-sharing deal that retains Mugabe as president while making Tsvangirai prime minister and Mutambara deputy prime minister.

But the agreement brokered by former South African President Thabo Mbeki on behalf of the regional SADC alliance immediately stalled as Mugabe and his main opponent, Tsvangirai, wrangled over who should control key ministries and other top government posts.

Tsvangirai and his MDC party meet on January 18 – a day after the ZCTU’s general council meeting – to review the stalled power-sharing deal. The MDC has insisted it will not join the unity government until all outstanding issues on Cabinet and other top government posts are resolved.

While analysts agree that Mugabe and Tsvangirai probably resent each other too much to be able to form a successful partnership, however they say there is little viable option to resolving Zimbabwe’s crisis outside a power-sharing government. – ZimOnline

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Naira depreciation: Black market poised to reclaim forex market

January 12, 2009 by admin  
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With the increasing scarcity of foreign  exchange in the parallel market and  further depreciation of the Naira, illegal foreign exchange operators have re-emerged and are poised to reclaim dominance of the market.

Meanwhile, investigation revealed that the margin enjoyed by banks on foreign exchange transactions have suddenly shot up by more than 1000 per cent.

Also fake foreign currencies have hit the foreign exchange market as fraudsters take advantage of the scarcity to defraud foreign exchange end users.

Last week, the CBN further depreciated the Naira by N7.75 (as at Wednesday) and it also suspended sale of foreign exchange to Bureaux De Change (BDC) operators.  Financial Vanguard was reliably informed that BDCs bid for forex on Monday and paid upfront, but the CBN told them to come for dollars  the following day (Tuesday). However, instead of giving them dollars as promised, the apex bank told them it was not selling and told them to come back for their money on Wednesday.

This, however, worsened foreign exchange supply in the parallel market occasioning a further rise in the exchange rate to about N142 per dollar on Wednesday and N147 on Thursday.

According to BDC operators, there is scarcity of forex in the market, and should the situation persist, black market operators would regain their dominance as major source of supply in the market and also dictate prices. According to the operator black market operators have returned with full force, and have also flooded the market with fake.

Investigation indeed revealed that this is already happening. Most people that need foreign exchange last week   had to resort to buying from the black market as most BDCs did not have currencies to meet demand.

It would be recalled that prior to 2006, when the CBN introduce further measures to liberalise the forex market, and in the process, commenced cash sale of forex to BDC to intervene in the parallel market, the market was dominated by black market operators. They were the dominant supplier of foreign exchange in the market and they dictated the exchange rate as they desired.

In fact, because they offer higher exchange rates, most forex users including government officials, banks and corporate bodies patronise black market operators. Even BDCs relied on them to meet customers demand. They were mostly used to roundtrip foreign exchange from the official market to the parallel market.

This, however resulted to rapidly depreciation of the Naira in the parallel market with the exchange rate touching N151 by March 2006,   while  the Naira  appreciated in the official and inter bank market, where the exchange rate stood at N129 and hence a premium of N22.

Miffed by this situation, the CBN decided to intervene in the market by selling dollars to BDCs. And within six months of the scheme, the parallel market rate crashed from N151 in March to N129 by September. Within this period, black market operators lost their grip on the market and their activities reduced to an insignificant level, as they disappeared from the street.

According to parallel market operators, the foreign exchange sale to BDCs, shifted demand from black market operators to them.

However this gained is been reversed by the scarcity in the market albeit created by the CBN. First, the apex bank reduced the amount of forex sale to BDCs from $300,000 per foreign exchange auction session to about N100,000. Last week it suspended foreign exchange sales to them hence making the  BDCs to  gradually lose their status as the dominant supplier of forex in the parallel market.  And this is compelling foreign exchange  end users to again turn to the black market operators.

In fact, a visit to the Airport Hotel, Ikeja or Broad Street, Marina axis on Lagos Island last week  reveal increasing presence of these illegal forex operators. Unlike  before the present predicament of the Naira, they have become more visible and aggressive in their activities.

Meanwhile, apart from the gradual return of black market operators, Vanguard investigation revealed that the scarcity of foreign  has prompted a sharp increase in the margin enjoyed by banks on forex exchange transactions. The margin represents the difference between the buying and selling rate offered by banks to the public.

Hitherto, the margin hovered between N2 and N3 in most banks, but it has now risen to N9 for dollar transaction. For Pounds Sterling N17, and N19 for the Euro.

For example, in one of the top five banks visited by Vanguard, the  buying rate for the  dollar was N132, and the selling rate was  N141 For Pound Sterling  the buying rate was N200 and the selling rate was N217 while that of the Euro is N180 for buying and N199 for selling.

Last year the Naira suffered 14.6 per cent depreciation on the average across the three segment of the market while  foreign exchange purchased by banks under the WDAS rose sharply by 26 per cent.
The Naira depreciated by 12.9 per cent at the segment of the foreign exchange market while it depreciated by 12.4 per cent and 18.6 per cent at the official and Bureau De change (BDC) segment respectively.

The official exchange rate however rose to N131.27 per cent in December, from N116.81 per dollar in January. The inter-bank foreign exchange rate also rose to N133.03 per dollar from N117.76 per dollar in January, while the BDC exchange rate also rose to from N118 per dollar to N140 at the close of business in December. Consequently, the Naira lost N15.43, N14.46 and N22 at the inter-bank, official and BDC segments respectively during the year.

Further analysis of the foreign exchange sales reveal that in the first quarter the total amount sold stood at $510.1 million. From $364.4 million in January it fell by 82 per cent to $65 million in February but rose by 24 per cent to $80.7 million March.

In the second quarter foreign exchange sold rose by 197 per cent to $1.519 billion.  In April it rose by 9.7 per cent to $79.7 million, while it shot up by 571.4 per cent in May to $660.2 million. The increase in sales slowed down to $31.25 per cent in June to $779.9 million.

The increased activities in WDAS  sessions were sustained in the third quarter hence total sales rose by 75.9 per cent to N2.673.4 billion. In July,  sales rose by 41.8 per cent to $1.106 billion. It further rose by 15.4 per cent to $1.276 billion in August. It however slumped by 77.25 per cent  in September to  $290.3 million.

Foreign exchange sales peaked in the fourth quarter as total sales rose to an all time high of $7.068 billion representing 164 per cent increase over the previous quarter.  In October it shot up by 1529 per cent to $3.365 billion in October. In November total sales dropped slightly by 8.8 per cent to $3.232 billion and further by 161 per cent in December to $470 million.

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Hong Kong forex reserve hits US$182.5 bln

January 12, 2009 by admin  
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Jan. 12, 2009 (China Knowledge) – Hong Kong’s official foreign exchange (forex) reserve hit US$182.5 billion at the end of December last year, US$16.6 billion more than that of a month earlier, according to statistics released by the Hong Kong Monetary Authority (HKMA) on Wednesday.

At the end of 2008, the total assets of foreign currency reserve, including the unsettled forward contracts, amounted to US$184.8 billion.

Hong Kong ranks the eighth in terms of foreign exchange reserve after the Chinese mainland, Japan, Russia, China’s Taiwan, India, Brazil and South Korea.

The current forex reserve is nearly eight times the currency in circulation.

In addition, the HKMA will issue forex funds worth HK$18 billion in January this year.

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South Fla. Optimistic After Obama Economy Speech

January 9, 2009 by admin  
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MIAMI BEACH (CBS4) ―At the FOREX trading room on Miami Beach Thursday, investors turned from their trading screens to a huge plasma television screen on the wall, where a larger than life President-elect Barack Obama was offering a grim assessment of the economy.

“It is a crisis unlike any we have seen in our lifetime,” Obama said, in the speech carried live by all the major networks.

As Obama described worsening unemployment, plummeting manufacturing and consumer confidence, FOREX manager Armando Martinez nodded, grimly.

Martinez said his business – buying and selling various currencies – is largely recession proof, but agreed with Obama that the economy overall is in big trouble and need of help. He said he was impressed by Obama’s speech.

“There is definitely hope. Whenever you hear Obama speak, there is a certain presence to him that does provide hope,” Martinez said.

Investor Charlie Brito said he’s not convinced that all of Obama’s massive plan for government spending and tax cuts makes good sense, but he applauded the president-elect’s tough talk and call for action.

“He has to do what he has to do,” Brito said. “One of the things a president has to do is try to instill hope in Americans, and he’s trying to do that.”

Business student Angelica Molina said, “I’m anxious, I’m concerned about the economy and what might happen. Hopefully, we’ll get better, but I’m worried.”

On her lunch break in Doral, retail worker Lina Rubio said, “I’m a little depressed to see how everything is. Everything’s so expensive and everybody’s broke.”

But Rubio said she has hope Obama’s economic stimulus plan will succeed. “We need to have faith, we need to hope,” she said.

On Ocean Drive in South Beach, some visitors in town for the BCS national championship college football game said, politics aside, everyone should be cheering for Obama to succeed.

“I think with the new administration coming in, we have to be more hopeful,” Julie Richardson, visiting from Oklahoma, said. “If we’re not optimistic, it could be devastating for the country.”

Another visitor, Keven Hansen, a Tulsa businessman, said, “If the president-elect wants to spur the economy, then spur it. Anything we can do to get things going would be fine.”

As for his thoughts on the future, Hansen said, “My mood is not quite as gloom and doom as the press and everybody else would seem to want me to think.”

(© MMIX, CBS Broadcasting Inc. All Rights Reserved.)

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Patients Fork Out Forex, Health System Comatose

January 9, 2009 by admin  
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BRIAN Towanda sits with his wife on a sofa counting down the days to January 15 — the day his spouse’s gynaecologist said she would deliver their first child.
Not even the political stalemate between President Robert Mugabe and MDC leader Morgan Tsvangirai on the formation of a unity government, the cholera epidemic and food shortages can drown Towanda’s excitement.
“Very soon I am going to be a father!” he declares excitedly.
As he looks at his wife’s huge tummy, he smiles wondering who the baby whom they have already named Chido would look like — him or his wife.
Their wish is to have the baby delivered at a private clinic that they believe has the requisite resources — medicines, hospital equipment and experienced staff — but the idea of not having foreign currency to meet the bill dampens his joyous fantasies.
Towanda, an accountant, bemoans that he cannot afford to give his unborn child the best treatment he had wished for.
In December he was paid through his bank $34 billion plus a 20-litre fuel coupon which he sold at US$15.
When he consulted a private hospital in the Avenues, Harare, Towanda was asked to fork out US$500 as a maternity registering fee.
The figures send shivers down his spine. He wondered what the Goodwills Masimirembwa-led National Incomes and Pricing Commission (NIPC) was doing to keep prices of goods and services in check.
Towanda decided to register his wife with a public hospital, the Mbuya Nehanda Maternity wing at Parirenyatwa, which was last year closed for a while due to shortages of resources like drugs, equipment and staff.
The hospital reopened recently after non-governmental organisations chipped in with funds and after it was given the green light by government to charge in foreign currency.
Towanda was told to pay US$300 as registration fees and for delivery of his wife — an amount he can hardly afford.
Charging in foreign currency in public health institutions will worsen the plight of the poor.
Health minister David Parirenyatwa said the government had allowed public hospitals and clinics to give patients the option to pay in foreign currency if they so wished. He said this did not mean the health institutions were no longer accepting local currency.
“What we have said is that our patients should continue paying in local currency, but in the event that they opt for foreign currency, we are to go by the Reserve Bank of Zimbabwe regulations,” Parirenyatwa said. “The idea is meant to facilitate a smooth flow of services while the patient receives treatment from the health care provider.”
However, in reality the hospitals are not interested in local currency.
Towanda prays that his wife has a normal birth with no complications that would result in a prolonged stay at the hospital as charges are roughly pegged at US$70 per night for admissions.
He hopes that the baby will not be born through a caesarian operation as that would require an extra US$150.
At least he is assured that his baby will not be premature as it would have resulted in him forking out US$5 daily for the use of an incubator.
A recent visit to Parirenyatwa by the Zimbabwe Independent showed no signs of improvement in health delivery.
Long grass has become a common feature outside the hospital — an indication that caretakers have long since abandoned the place. Fears are high that the unkempt hospital grounds have become breeding areas for mosquitoes.
There is now little activity at the hospital that used to be very busy.
Noticeable were dark corridors with no lighting as well as dirty floors and dumped bed linen in some wards. One would be forgiven for likening the situation to a scene from a horror movie. It is very rare to bump into a nurse, more so a doctor, in the corridors of the hospital.
At Mbuya Nehanda the tiles that used to be bright and clean have lost their lustre while some of the hospital bed linen is no longer suitable for use.
Zimbabwe Association of Doctors for Human Rights (ZADHR) chairman Douglas Gwatidzo said paying in foreign currency at government hospitals showed that the government no longer had confidence in the local currency.
“The reason why the government made that announcement is that people were finding it difficult to get the Zimbabwe dollar, however the announcement to me shows that there is now a gradual acceptance of no confidence in our local currency,” Gwatidzo said. “It’s a pity that Zimbabweans are made to suffer as the foreign currency is beyond the reach of many. Life is going to be difficult. We have not seen the worst. As long as there is no manpower there is no health delivery system.”
Meanwhile, Unicef this week said as long as there is no urgent move to guarantee availability of safe water, sewage reticulation and refuse removal, the cholera epidemic was not going to disappear any time soon no matter the efforts put in place so far.

Unicef information officer Tsitsi Singizi said latest statistics show that cholera has claimed over 1700 lives since its outbreak in August last year. More than 34 300 cases of the epidemic were also recorded.
Fifty-nine deaths and 731 new cases of cholera have been reported since Monday.
She said: “The cholera situation in Zimbabwe remains dire. We continue receiving reports of fresh cases and the fatality rate is still high at 5%, more than the internationally accepted threshold.
“Yet we are also happy that coordinated efforts are beginning to yield results as cases and deaths go down in some affected areas.”
International agencies like Oxfam — with partners Mercy Corps, Africare, Practical Action, Zimpro, Lead Trust, DachiCare and Christian Development Aid — have deployed engineers, public health promoters, gender and HIV specialists to seven provinces where they are responding to the cholera crisis.
An Oxfam spokesperson said assessments of water quality conducted by the organisation in Norton, Chegutu and Kadoma indicated that 75% of water samples from unprotected wells were contaminated with faecal coliforms.
The spokesperson said: “The degree of contamination is highest in Maridale and Joburg suburbs of Norton where the population draws water from wells and use a pit latrine system. Results of the analysis are being used to chlorinate water sources at the respective locations.”
The organisation has so far reached almost 250 000 people with hygiene promotion messages and distributed hygiene kits to 37 147.
Apart from constructing and rehabilitating a number of boreholes, Oxfam has delivered 245 000 cubic meters of water to Chitungwiza, Mbare, Budiriro and Glen View to ensure that communities and Cholera Treatment Centres in those areas have access to clean and safe water.
The Zimbabwe Red Cross Society has sent emergency disaster kits to hard-hit areas like Karoi and Kariba.
Some parts of Karoi are said to have gone without power for two weeks and this has greatly affected the water supply in the small town.
Magunje growth point and Bikita are some of the rural areas that have been hard hit by cholera and need immediate attention.

BY WONGAI ZHANGAZHA

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FXCM Microlot Forex Trading Positive Spread

January 8, 2009 by admin  
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Now i have an account with fxcm micro. with fxcm micro, i had positive spread once on EURUSD pair while spread as low as -4 on GBPJPY. for more info you can go to fxcm micro at forexmicrolot.com

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Forex: Halal atau Haram ? Macam Ayam?

January 8, 2009 by admin  
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Swap, forward, hedging, spot forex ? Halal atau haram forex dihuraikan dalam video oleh ustaz zaharuddin yang dipaparkan di youtube, Anda tengok dan timbang2 kan.

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Misa Urges Mobile Firms to Reconsider Charging in Forex

January 8, 2009 by admin  
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Jan 07, 2009 (SW Radio Africa/All Africa Global Media via COMTEX) –
The Media Institute of Southern Africa (MISA) has expressed concern that the charging for mobile phone services in foreign currency by all the major networks is seriously impeding the right of Zimbabweans to communicate.

Many people interviewed by Newsreel say they can no longer buy airtime for their phones because the little forex they manage to get has to be used to buy scarce basic commodities.

The Reserve Bank of Zimbabwe recently granted the mobile networks permission to charge in foreign currency. This was after the networks complained that they lost money to hyper-inflation by producing monthly phone bills. MISA noted the inability of subscribers to buy airtime for their phones and said this added to ‘the appalling state of fixed and mobile telephone networks in Zimbabwe which has seen subscribers failing to communicate as and when they desire, despite the high tariff charges.’

Although Zimbabwe’s economy has virtually been ‘dollarised’ the majority of workers still earn the near worthless Zimbabwe dollars. MISA say they want the ‘Postal and Telecommunications Regulatory Authority of Zimbabwe (POTRAZ) to act with the full understanding that communication is a human right and not a privilege and that telecommunications remain key pillars of freedom of expression and access to information.’

This state of affairs however is not expected to worry the Mugabe regime who are acutely aware that information remains a powerful tool for exposing the excesses of any government.

There have also been reports that police in Bulawayo arrested over 100 street vendors, shop owners and transport operators who had charged for goods and services in forex, without central bank authority. The Zimbabwe Times website quotes a worker at the Bakers Inn outlet along Fort Street saying they were forced to close their shop while police arrested their manager. They were later told to pay a fine of US$20 000.

At the centre of the problem is that to get a licence to sell in foreign currency from the central bank costs between US$20 000 and US$100 000. This has effectively sidelined small businesses who don’t have the resources to apply and also cannot afford to sell goods in the worthless local currency that daily falls in value. It’s a ‘do or die’ situation were the small dealers have no option but take the risk of selling their wares in forex.

Meanwhile the Zimbabwe Congress of Trade Unions has denied state media reports that they are opposed to workers being paid in foreign currency. A statement from Acting Secretary General Gideon Shoko said; ‘The ZCTU position is clear and says that all workers should be paid in foreign currency given the fact that shops are now selling their goods in foreign currency, even those that have not been licensed to do so. Workers are even forced to pay rentals and fares in foreign currency.’

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