|
PureBytes Links
Trading Reference Links
|
SUMMARY
The dollar opened lower in New York, continuing its recent slide, after the
weekend G7 meeting failed to produce any concrete measures to curb global
crises. Although the G7 focus appeared to be mostly on boosting Japanese
growth, the finance ministers agreed to tackle global economic problems with
global-oriented policies, but it is uncertain whether this will lead to
concerted interest rate cuts. The US and Canadian central banks last week
lowered their key lending rates to boost investor confidence, and Britain is
considered to be the next one to cut rates. The GBP fell notably overnight
on this growing expectation. UK rate cut talk has grown as global turmoil
has wiped GBP 250 billion off the value of British shares since July and as
the rot which has eaten away at Britain's manufacturing sector shows no
signs of spreading into service industries. The Bank of England's monetary
Policy Committee has not cut rates in more than two years.
This week, hard evidence of a slowing domestic economy may also take center
stage as Q3 corporate earnings begin to roll in; additionally, the
relentless melee over whether the House Judiciary Committee panel will
recommend a formal investigation of whether Clinton's actions should lead to
his removal from office will continue to interest the markets. Expect the
IMF meeting to peak the markets interest.
ASIA
Key Asian stock markets dived overnight, nonplused by the bland G7
statement. The Hang Seng index slipped more than 4%, with the Nikkei
slipping to another 12-year closing low. In Bombay, stocks were down 7%,
Australia and Malaysia by 1%, and Singapore and Manila close to 2%. Markets
in South Korea and Taiwan are closed today for public holidays. On Saturday,
Japan unveiled a $30 billion aid program to help its Asian neighbors rebuild
their economies. Miyazawa told a meeting of finance ministers and central
bank governors from Thailand, Indonesia, Malaysia, the Philippines,
Singapore and South Korea that the aid will consist of $15 billion to help
meet short-term capital needs and another $15 billion for medium-term
funds.
Richard Chehovin
|