Asia Stay updated with Business News, Pakistan news, Current world news and latest world news with Business Recorder.. http://www.brecorder.com/markets/fxmm/asia.html Sun, 21 Dec 2014 20:05:02 +0000 SRA Framework 2.0 en-gb Sri Lankan rupee forwards end steady for 5th straight session http://www.brecorder.com/markets/fxmm/asia/212239-sri-lankan-rupee-forwards-end-steady-for-5th-straight-session.html http://www.brecorder.com/markets/fxmm/asia/212239-sri-lankan-rupee-forwards-end-steady-for-5th-straight-session.html imageCOLOMBO: Sri Lankan rupee forwards closed steady for a fifth straight session on Friday, as the central bank capped trading at 132.00 per dollar through moral suasion.

The four-day forwards or spot-next-next, which were actively traded, closed at 131.98/132.02 per dollar, little changed from Thursday's close of 131.98/132.05.

The spot currency and three-day forwards, or spot-next, were not traded after the central bank capped the currency at predetermined levels to prevent volatility, traders said. Central bank Governor Ajith Nivard Cabraal said the rupee would be stable during this month.

Dealers said Cabraal's statement was not a surprise for the market because the central bank has been holding the currency at the current level. Overseas investors sold a net 367 million rupees worth of government securities during the week that ended Dec. 17. They sold a net 44.27 billion rupees ($337.42 million) worth in the 12 weeks to Dec. 17, data from the central bank showed.

Copyright Reuters, 2014

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s.rs96@yahoo.com (Shoaib-ur-Rehman Siddiqui) Asia Fri, 19 Dec 2014 14:57:51 +0000
Singapore bonds set for S$11bn refi boost By Kit Yin Boey http://www.brecorder.com/markets/fxmm/asia/212118-singapore-bonds-set-for-s$11bn-refi-boost-by-kit-yin-boey.html http://www.brecorder.com/markets/fxmm/asia/212118-singapore-bonds-set-for-s$11bn-refi-boost-by-kit-yin-boey.html imageSINGAPORE: Benchmark rates have fallen in the Singapore dollar bond market, making for conducive conditions for new issues early in 2015 as issuers begin refinancing S$11.13bn (US$8.5bn) of bonds due to mature in 2015.

The 10-year Singapore dollar SOR tumbled some 42bp in the last three months to 2.25% on December 16 from 2.675% on September 19.

Simultaneously, government bond yields have also dipped at the long ends of the curve. The 10-year ended last year at 2.59%, but was at 2.17% on Monday.

Both benchmarks have moved in tandem with long-dated US Treasury yields. The 10-year UST yield was around 3.0% a year ago, but was quoted at 2.12% on Monday.

Analysts are predicting that the US Federal Reserve will start to raise rates next September or October, and DBS researchers predict that the 10-year SGS yield will rise to 2.35% in the first quarter, before gradually increasing to 2.65% in the last quarter of 2015.

This paves the way for a rush to market early in 2015 as issuers rush to lock in low rates, potentially boosting bond volumes next year. At the same time, investors remain hungry for yield, and have driven new issues to S$22.55bn this year, up 28% from S$17.6bn in 2013, according to Thomson Reuters data.

"As long as rates remain low, there is going to be appetite, even for high-yield instruments, based on the most recent response to HY bonds and enquiries received in Singapore," said one credit analyst for a private bank.

The potential pool of refinancing deals is slightly larger than the S$9.4bn worth of bonds that expired this year. A sizable S$4.5bn worth of maturing bonds will come from government-linked entities and large corporate borrowers, raising the possibility that such high-grade issuers could finally visit the bond market.

Among them is a S$600m sukuk due in August from Danga Capital, the funding vehicle of Malaysia's Khazanah Nasional, as well as S$520m in two issues from SP Power Assets that will mature in April and August.

Over the last two years, high-grade issuers have been largely absent from the local bond market, while small and mid-cap issuers have driven new issue numbers to a record. However, a continued oil price slump resulted in a selloff in high-yield issues in early December, and that may be just the opportunity large corporations have been seeking.

"The high-yield market will be rather subdued going into the New Year because people have become unsure of how global economies will do," said one debt syndicate head with an Asian bank.

"With the HY names sidelined, high-grade and GLC names will have a clearer runway and I see them emerging in the first quarter of next year."

Coming out earlier in the year will be seen as a strategic move to catch a downward trend in the long-dated benchmark rates used in the local bond market.

In addition to issuers preparing to refinance maturing debt, real-estate companies are also expected to tap the bond market to fund their repurchases of unsold properties to avoid paying a hefty tax penalty to the government.

"There will also be more bond-buyback opportunities, and more companies will embark on liability management exercises, which will lead to more consent-solicitation tenders, as well," said another debt syndicate banker with a foreign bank.

Copyright Reuters, 2014

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parvezjabri@yahoo.com (Parvez Jabri) Asia Fri, 19 Dec 2014 08:13:22 +0000
JGBs mostly firm, yields out to four years below zero http://www.brecorder.com/markets/fxmm/asia/212117-jgbs-mostly-firm-yields-out-to-four-years-below-zero.html http://www.brecorder.com/markets/fxmm/asia/212117-jgbs-mostly-firm-yields-out-to-four-years-below-zero.html imageTOKYO: Japanese government bond prices held mostly firm on Friday with two-year yield hitting a record low and yields up to four years staying below zero on expectations of a bond shortage next week, ahead of a large redemption.

The two-year JGB yield fell 2.5 basis points to minus 0.040 percent, while five-year bonds maturing Sept 2018, for example, traded at minus 0.010 percent.

The 20-year JGB yield fell 0.5 basis point to 1.115 percent while the 30-year yield dipped 1.0 basis point to 1.320 percent.

Although US Treasuries dipped on the Federal Reserve's upbeat economic assessment, JGBs were well-supported because the Bank of Japan's bond buying has led to a scarcity of bonds.

Investors will have cash to put to work as a large amount of JGBs is due to mature on Monday. The 10-year sector was weaker than other maturities, with the 10-year yield ticking up 1.0 basis point to 0.355 percent .

The market showed no reaction to the Bank of Japan's decision to keep its policy on hold.

Copyright Reuters, 2014

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parvezjabri@yahoo.com (Parvez Jabri) Asia Fri, 19 Dec 2014 08:11:52 +0000
Yen weakens in Asia after BoJ meeting http://www.brecorder.com/markets/fxmm/asia/212105-yen-weakens-in-asia-after-boj-meeting.html http://www.brecorder.com/markets/fxmm/asia/212105-yen-weakens-in-asia-after-boj-meeting.html imageTOKYO: The yen weakened in Asia Friday after the Bank of Japan held off fresh easing measures and struck a slightly more upbeat view of the world's number three economy.

In Tokyo, the greenback rose to 119.31 yen from 118.87 yen before the BoJ policy announcement and 118.81 yen in New York.

The euro strengthened to 146.53 yen from 146.00 yen, while it was at $1.2281 against $1.2287 in US trade.

"Exports have shown signs of picking up" while factory output has started to "bottom out", the BoJ said in a post-meeting statement.

"Japan's economy is expected to continue its moderate recovery."

Plunging oil prices have helped narrow Japan's gaping trade deficit while a sharply weaker yen has been a plus for the country's exporters.

But lower energy import prices are also digging into the BoJ's efforts to reach a 2.0 percent inflation rate -- aimed at ending years of deflation and unimpressive growth -- which has boosted speculation about further easing in 2015.

Crude prices have plunged roughly 50 percent since June owing to plentiful supplies, a stronger dollar and weak demand as the global economy struggles, analysts say.

The dollar has also won support from Wednesday's US Federal Reserve announcement that it planned to keep interest rates low and said it would be "patient in beginning to normalise the stance of monetary easing".

The comments suggested a rate hike was unlikely before mid-2015.

The ruble held steady at 61.08 against the dollar after President Vladimir Putin vowed Russia would soon recover from the worst financial crisis of his rule and said his grip on power was firm -- despite new Western sanctions and plunging oil prices, a key export for the country.

The ruble has gone through wild fluctuations this week -- falling to a record low of 80 against the dollar at one point -- with the central bank raising interest rates to 17 percent and Russians snapping up imported goods ahead of expected price hikes.

The dollar was mixed against other Asia-Pacific currencies.

The greenback bought 12,547 Indonesian rupiah, down from 12,565 on Thursday.

It also fell to 1,101.83 South Korean won from 1,102.57 won, to 63.08 Indian rupees from 63.31 rupees, and to 32.85 Thai baht from 32.92 baht.

The dollar rose to Sg$1.3143 from Sg$1.3124, to Tw$31.47 from Tw$31.41, and to 44.75 Philippine pesos from 44.71 pesos.

The Australian dollar edged up to 81.89 US cents from 81.34 cents, while the Chinese yuan bought 19.16 yen against 19.07 yen.

Copyright AFP (Agence France-Presse), 2014

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parvezjabri@yahoo.com (Parvez Jabri) Asia Fri, 19 Dec 2014 07:23:29 +0000
Yen weakens in Asia after BoJ meeting http://www.brecorder.com/markets/fxmm/asia/212044-yen-weakens-in-asia-after-boj-meeting.html http://www.brecorder.com/markets/fxmm/asia/212044-yen-weakens-in-asia-after-boj-meeting.html imageTOKYO: The yen weakened in Asia Friday after the Bank of Japan held off fresh easing measures and struck a slightly more upbeat view of the world's number three economy.

In Tokyo, the greenback rose to 119.27 yen from 118.87 yen before the BoJ policy announcement and 118.81 yen in New York.

The euro strengthened to 146.47 yen from 146.00 yen, while it was at $1.2279 against $1.2287 in US trade.

Investors are now awaiting BoJ governor Haruhiko Kuroda's regular post-meeting news briefing later in the day, looking for any hints about policy moves in the new year.

"Exports have shown signs of picking up" while factory output has started to "bottom out" , the BoJ said in a post-meeting statement.

"Japan's economy is expected to continue its moderate recovery."

Plunging oil prices have helped narrow Japan's gaping trade deficit while a sharply weaker yen has been a plus for the country's exporters.

But lower energy import prices are also digging into the BoJ's efforts to reach a 2.0 percent inflation rate -- aimed at ending years of deflation and tepid growth -- which has boosted speculation about further easing in 2015.

Crude prices have plunged roughly 50 percent since June owing to plentiful supplies, a stronger dollar and weak demand as the global economy struggles, analysts say.

The dollar has also won support from Wednesday's US Federal Reserve announcement that it planned to keep interest rates low and said it would be "patient in beginning to normalise the stance of monetary easing".

The comments suggested a rate hike was unlikely before mid-2015.

The ruble held steady at 60.12 against the dollar after President Vladimir Putin vowed Russia would soon recover from the worst financial crisis of his rule and said his grip on power was firm -- despite new Western sanctions and plunging oil prices, a key export for the country.

The ruble has gone through wild fluctuations this week -- falling to a record low of 80 against the dollar at one point -- with the central bank raising interest rates to 17 percent and Russians snapping up imported goods ahead of expected price hikes.

Copyright AFP (Agence France-Presse), 2014

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parvezjabri@yahoo.com (Parvez Jabri) Asia Fri, 19 Dec 2014 05:21:45 +0000
Indian rupee sees biggest gain in 7 months post Fed; bonds up for 2nd day http://www.brecorder.com/markets/fxmm/asia/212025-indian-rupee-sees-biggest-gain-in-7-months-post-fed;-bonds-up-for-2nd-day.html http://www.brecorder.com/markets/fxmm/asia/212025-indian-rupee-sees-biggest-gain-in-7-months-post-fed;-bonds-up-for-2nd-day.html imageMUMBAI: Indian markets rallied on Thursday, with the rupee posting its biggest single-day gain in seven months and rebounding from a 13-month low, after the U.S. Federal Reserve said it would take a "patient" approach in deciding when to raise interest rates.

Reserve Bank of India Governor Raghuram Rajan had called the prospect of U.S. rate hikes a risk to emerging markets given expectations that overseas investors may pare their bets on higher-yielding debt of countries such as India.

Indian shares and bonds also benefited as Russia's rouble stabilised after dramatic falls this week, reducing some of the fears of financial contagion to emerging markets.

Bonds and the rupee were still headed for their worst week since August, when global markets were roiled by rising tensions in the Middle East and uncertainty about Fed rate hikes.

"The fact that rate hikes will still be data dependant and Fed will be patient is positive for the rupee," said Hari Chandramgethen, head of foreign exchange trading at South Indian Bank, who does not expect a Fed rate hike until June.

Traders said large dollar-selling by foreign banks on behalf of their overseas clients was a key reason helping the rupee and bonds during the session. The flows will remain a key factor in the near-term for markets.

The partially convertible rupee ended at 63.11/12 per dollar versus its Wednesday's close of 63.6150/6250. It had touched 63.89 in the previous session, its weakest level since Nov. 13, 2013.

On the day, the rupee gained 0.8 percent, its biggest single-day gain since a similar rise seen on May 16 when election results gave the Bharatiya Janata Party a full mandate.

Fed Chair Janet Yellen told a news conference that "patient" meant the U.S. central bank was unlikely to hike rates for "at least a couple of meetings," meaning April of next year at the earliest.

The benchmark 10-year bond yield ended down 4 basis points on the day at 7.93 percent. The yield rose to 8.03 percent on Wednesday, its highest level since Dec. 1.

In the overnight indexed swaps market, the benchmark 5-year swap rate dropped 6 basis points to 7.28 percent, while the 1-year rate fell 7 basis points to 7.85 percent.

Meanwhile, shares gained 1.6 percent on hopes of tax reforms and underpinned by the global rally.

Copyright Reuters, 2014

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imad_kueconomist@yahoo.com (Imaduddin) Asia Thu, 18 Dec 2014 15:57:08 +0000
Sri Lankan rupee fwds end steady; cbank sees stable currency in Dec http://www.brecorder.com/markets/fxmm/asia/212019-sri-lankan-rupee-fwds-end-steady;-cbank-sees-stable-currency-in-dec.html http://www.brecorder.com/markets/fxmm/asia/212019-sri-lankan-rupee-fwds-end-steady;-cbank-sees-stable-currency-in-dec.html imageCOLOMBO: Sri Lankan rupee forwards closed steady for a fourth straight session on Thursday, as the central bank's moral suasion forced banks to cap trading at 132.00 per dollar.

Central bank Governor Ajith Nivard Cabraal said the rupee would be stable during this month.

"There is no change in our outlook and we expect it will be stable," Cabraal told Reuters. "We have seen upward and downward movements in the rupee, but they are not at any threat level."

The four-day forwards or spot-next-next, which were actively traded, closed at 131.98/132.05 per dollar, little changed from Wednesday's close of 131.99/132.02.

The spot currency and three-day forwards, or spot-next, were not traded after the central bank capped the currency at predetermined levels to prevent volatility, traders said.

"There was dull trade and we expect the sluggishness to continue until the end of this month because of the year-end season," a currency dealer said.

Overseas investors sold a net 3.75 billion rupees worth of government securities during the week that ended on Dec. 10. They sold a net 43.9 billion rupees ($334.86 million) worth in the 11 weeks through to Dec. 10, data from the central bank showed.

Copyright Reuters, 2014

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imad_kueconomist@yahoo.com (Imaduddin) Asia Thu, 18 Dec 2014 15:39:46 +0000
Ringgit sentiment worst since 2008; bearish rupiah bets rise http://www.brecorder.com/markets/fxmm/asia/211969-ringgit-sentiment-worst-since-2008;-bearish-rupiah-bets-rise.html http://www.brecorder.com/markets/fxmm/asia/211969-ringgit-sentiment-worst-since-2008;-bearish-rupiah-bets-rise.html imageSINGAPORE: Bearish bets on the Malaysian ringgit rose slightly and remained at their highest since the 2008-09 global financial crisis, while short positions in the Indonesian rupiah hit a two-month high, a Reuters poll found on Thursday.

A recent slide in oil prices and the Russian rouble have soured investor sentiment toward emerging market currencies in general and weighed on Asian currencies, although sentiment improved somewhat after the rouble strengthened sharply on Wednesday.

Investor bets on the Chinese yuan turned bearish for the first time since June. On Thursday, the yuan slumped to a five-month low against the dollar after China's central bank set a weaker daily midpoint fixing, prompting investors to cut exposure to the local currency.

The poll showed that investor sentiment toward most emerging Asian currencies remained bearish, with short positions in the Indonesian rupiah rising to their highest since early October.

The rupiah hit a 16-year low of 12,930 on Tuesday according to Reuters data. Analysts said the rupiah fell due to corporate demand for dollars and worries that overseas investors were pulling money out of Indonesian assets, with its moves exacerbated by thin year-end trading conditions.

Investor bets on the Indian rupee remained slightly bullish, but long positions in the rupee were trimmed to their lowest level in two months.

The rupee hit a 13-month low against the dollar on Wednesday as the brewing financial crisis in Russia continued to raise concerns about foreign fund outflows.

Bearish bets on the Malaysian ringgit rose slightly in the two weeks since the last survey, and remained at their highest level since September 2008. The ringgit hit a five-year low of 3.5040 last week on worries that sliding oil prices would hurt Malaysia's current account and fiscal deficit.

Investor bets turned bullish toward the Philippine peso, with long positions in the currency reaching their best level since late August.

Last week, the peso had risen to its highest level in nearly three months after Moody's Investors Service upgraded its rating on the Philippines by one notch to Baa2 from Baa3, citing a decline in the Philippines' debt burden and structural improvements in fiscal management.

Elsewhere, bearish bets against the Thai baht rose to their highest level since June. Short positions in the Taiwan dollar increased slightly and remained at their highest level since early 2009.

The Reuters survey is focused on what analysts believe are the current market positions in nine Asian emerging market currencies: the Chinese yuan, South Korean won, Singapore dollar , Indonesian rupiah, Taiwan dollar, Indian rupee, Philippine peso, Malaysian ringgit and the Thai baht.

The poll uses estimates of net long or short positions on a scale of minus 3 to plus 3.

A score of plus 3 indicates the market is significantly long US dollars. The figures included positions held through non-deliverable forwards (NDFs).

Copyright Reuters, 2014

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imad_kueconomist@yahoo.com (Imaduddin) Asia Thu, 18 Dec 2014 12:34:13 +0000
Rupiah and ringgit climb as Fed calms market nerves http://www.brecorder.com/markets/fxmm/asia/211962-rupiah-and-ringgit-climb-as-fed-calms-market-nerves.html http://www.brecorder.com/markets/fxmm/asia/211962-rupiah-and-ringgit-climb-as-fed-calms-market-nerves.html imageSINGAPORE: The Indonesian rupiah, Malaysian ringgit and Indian rupee all rose on Thursday as an upbeat economic assessment by the US Federal Reserve calmed market nerves.

The South Korean won, however, fell against the dollar after the Fed signalled it was on track to raise interest rates next year, altering a pledge to keep them near zero for a "considerable time" in a show of confidence in the US economy.

The rupiah outperformed and pulled away from a 16-year low of 12,930 set on Tuesday, according to Reuters data, while the Indian rupee clawed away from a 13-month low of 63.89 touched on Wednesday.

Suspected central bank intervention helped bolster the rupiah. In addition, foreign funds were cited as good buyers of Indonesian bonds and equities on Thursday.

Indonesia's central bank deputy governor said on Wednesday that Bank Indonesia will continue its role to "stabilise" the rupiah in foreign exchange markets and sovereign bond prices in the secondary market.

The rupiah had seen its drop accelerate earlier in the week due to year-end corporate demand for dollars and worries that overseas investors were pulling money out of Indonesian bonds.

The ringgit hit a two-week high of 3.4605. It edged away from a five-year low of 3.5040 set last week, when it fell on worries that sliding oil prices would hurt Malaysia's current account and fiscal deficit.

Copyright Reuters, 2014

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imad_kueconomist@yahoo.com (Imaduddin) Asia Thu, 18 Dec 2014 12:24:45 +0000
Dollar jumps as Fed rate guidance shows quiet confidence in US economy http://www.brecorder.com/markets/fxmm/asia/211867-dollar-jumps-as-fed-rate-guidance-shows-quiet-confidence-in-us-economy.html http://www.brecorder.com/markets/fxmm/asia/211867-dollar-jumps-as-fed-rate-guidance-shows-quiet-confidence-in-us-economy.html imageTOKYO: The dollar took the upper hand on Thursday after the Federal Reserve signalled it was on track to raise interest rates next year, altering a pledge to keep them near zero for a "considerable time" in a show of confidence in the US economy.

The Fed said it would take a "patient" approach in deciding when to bump borrowing costs higher, guidance which it said is consistent with its previous statement that rates will be low "for a considerable time."

Fed Chair Janet Yellen told a news conference that the statement meant it was unlikely to hike rates for "at least a couple of meetings," meaning April of next year at the earliest.

"The markets have had some relief as the Fed is moving forward as planned, but not too fast, in raising rates," said Takako Masai, the head of market research at Shinsei Bank. The dollar index rose to 88.998, almost flat in Asia but having risen 1.0 percent on Wednesday and coming within a striking distance from a near six-year high of 89.550 touched 10 days ago.

Against the yen, the dollar rose to 118.58 yen, extending its rebound from one-month low of 115.565 hit on Tuesday on fears over falling oil prices and the beleaguered Russian rouble.

"What's going on is an unwinding of dollar short positions," said chief trader at a Japanese brokerage. "The global jitters in recent days calmed a bit overnight.

The Fed's statement was also supportive." Many market participants expect the dollar to be in a modest uptrend throughout 2015 on the back of firming US economy and interest rate differentials between other major currencies.

But a rapid rise is unlikely, with many speculators heading into holidays with the Fed meeting out of the way.

In addition, possibly curbing the speed of any gains in the dollar, disinflationary pressure from plunging oil prices is manifesting even in the United States, raising doubts on how far the Fed can actually raise rates next year.

Indeed, data showed on Wednesday US consumer prices recorded their biggest drop in nearly six years in November as gasoline prices tumbled While Fed officials shrugged off the disinflationary trend as transitory, Fed policymakers' median forecast of the policy rate at the end of next year was lowered to 1.125 percent from 1.375 percent in September.

"It shows Fed policymakers are becoming less convinced on continued rate hikes. It is questionable how far the dollar can keep rallying," said Daisuke Uno, chief strategist at Sumitomo Mitsui Bank.

Others also worry investors' dollar buying positions may already be stretched.

"Everyone concludes the same and is betting the same way. As a result, it's like landmines are everywhere," said Fumio Nakakubo, chief investment officer for Japan at UBS's Wealth Management division.

There is little major data in Asia and trading could slowly dwindle as many market players set off for year-end holidays, but traders are keeping an eye on oil prices, the rouble and some other battered emerging market currencies.

The rouble rebounded on Wednesday after dramatic falls on the previous two days as the government pressured exporters not to hoard foreign-currency earnings and the central bank announced new measures to support financial stability.

Oil prices were mixed after wild swings on Wednesday, with US crude futures trading up 0.1 percent at $56.54 per barrel , off 5-1/2-year low of $53.60 hit on Tuesday.

The euro slipped to $1.2345 from above $1.25, coming less than a cent away two-year low of $1.2247 hit earlier this month.

The British pound fell to 15-month low of $1.5539 on Wednesday while the Australian dollar hit a 4 1/2-year low of $0.8107.

The next focus for the euro is the influential Ifo German business climate survey due at 0900 GMT, which is expected to show a small improvement in Europe's biggest economy.

Copyright Reuters, 2014

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s.rs96@yahoo.com (Shoaib-ur-Rehman Siddiqui) Asia Thu, 18 Dec 2014 07:33:00 +0000