LONDON, Sept 24, 2018 (News Wires) - The dollar slipped on Monday, erasing its earlier gains, as investors searched for fresh clues to extend a multi-month rally in the greenback before a widely expected interest rate hike by the US central bank this week.
With market forecasts for further interest rate hikes by the US Federal Reserve in line with policymakers' thinking at roughly three more rate hikes after a quarter-point increase this week, analysts said only unexpectedly strong data would change those bets.
"The dollar rally needs fresh legs and that will have to come from either a big change in rate hike expectations or upside surprises in inflation and wage data," said Lee Hardman, a currency strategist at MUFG in London.
Earlier the dollar snapped a two-week losing streak as the weekend brought trade tensions back into the spotlight after Beijing released a white paper on the trade dispute saying it would seek a reasonable outcome, while also describing US tactics as "bullying".
The greenback eased 0.2 per cent to 94.07 against a basket of its rivals after being up as much as 0.1 per cent earlier.
Moreover, with the Fed set to raise interest rates for the eighth time since late 2015, speculators had ramped up bets that interest rate differentials between the United States and other major economies, particularly Europe, will stretch wider.
"We typically see this brief window before a US rate meeting when hedge funds buy the dollar, and the trade war headlines are also aggravating that trend," said Viraj Patel, an FX strategist at ING in London.
Latest positioning data showed net speculative long positions on the greenback increasing by their biggest daily rise in more than two months.
For example, net long positions for the dollar have swelled to $25 billion according to CFTC data.
The euro rose 0.2 per cent to $1.1772 on some relief that German Chancellor Angela Merkel's coalition government resolved a dispute over the country's scandal-tainted spy chief on Sunday, ending a threat to the six-month-old administration.
The pound was the biggest gainer against the dollar, rising 0.7 per cent to $1.3136 line after British Brexit Secretary Dominic Raab said on Monday he was confident London would eventually clinch a Brexit deal with the European Union.
Still, investors remained bearish on the British currency with overall short positions rising to a 4-1/2 month high of $6.5 billion, according to latest CFTC data.
LONDON, Sept 21, 2018 (News Wires) - Oil prices rose on Friday ahead of a meeting of OPEC and other large crude exporters that will focus on production increases as US sanctions restrict Iranian exports.
OPEC and its allies are scheduled to gather in Algeria on Sunday to discuss how to allocate higher supply to offset the shortage of Iranian supplies.
Brent crude oil was up 85 cents at $79.55 a barrel by 11:40 GMT US light crude was up 55 cents at $70.87.
Brent is close to four-year highs, trading just below $80 a barrel, as investors bet that the Organization of the Petroleum Exporting Countries will be unable to compensate fully for the loss of oil from Iran, OPEC's third-biggest producer.
But the meeting on Sunday is unlikely to be able to change production policy. Such a move would require OPEC to hold what it calls an "extraordinary meeting", which is not on the agenda.
US President Donald Trump increased pressure on OPEC on Thursday, calling on the organisation to "get prices down now!"
"We protect the countries of the Middle East, they would not be safe for very long without us, and yet they continue to push for higher and higher oil prices," Trump wrote on Twitter.
Trump's criticism was directed primarily at Saudi Arabia, OPEC's biggest producer, after the kingdom said it could tolerate oil prices above $80, at least in the short term, said Commerzbank commodities analyst Carsten Fritsch.
"Saudi Arabia now faces a dilemma," Fritsch said. "Refusing to step up production would mean going against the will of ally Trump, but giving in to Trump´s demand would make it his accomplice, which could see OPEC tested to the limit."
Tanker tracking and industry data show Iranian exports of crude have already begun to decline well before the imposition of new US sanctions on Tehran.
"Iranian crude exports are coming (down) earlier and bigger than expected, at a time seasonal demand is strong. With spare capacity also falling sharply, the market remains exposed to supply-induced price shocks," ANZ Bank analysts said in a note to clients.
CAIRO, Sept 21, 2018 (MENA) - The African Development Bank (AFDB) is currently taking all needed procedures to disburse the third and last tranche of its $1.5 billion loan to Egypt, Vice President of the Bank Khaled Sherif said on Friday.
The third tranche worth $500 million dollars, he pointed out.
Sherif said that the loan seeks to support government programs that aim to achieve a comprehensive economic and social development, based on attaining social justice offering job opportunities and improving the business operating environment, he noted.
Sherif made the remarks during his meeting with Investment and International Cooperation Minister Sahar Nasr in the presence of Mohamed El Azizi the bank’s Director General for the Middle East and North Africa, Malinne Blomberg, Egypt Country Manager and Ahmed Zayed, Executive Director for Egypt at the bank.
Both sides discussed prospects of cooperation in supporting the private sector and infrastructure in Sinai, a move that contributes to luring investors.
The AFDB mission voiced the bank’s readiness to offer support needed to help push forward the economic and social development in Egypt.
By Simon Willis
A year ago, road users regarded Hegaz Square as a free-for-all in which the fastest and least circumspect motorist would always win. However, the structured chaos of a spot where five roads meet is now controlled by traffic lights, although the cyclist who nearly ran over a shopping-bag-laden old woman might have disagreed as he proceded against the traffic flow.
The people wait at the corner of Nozha Street and Hegaz Street await buses of various ages and states of repair to take them home or to the second job. The tram lines no longer operate, but its hardware lingers in case the operators change their minds and provide a service as regular as a broken clock.
Two white-uniformed policemen sit outside a bank. A matt-black-painted armoured stand complete with sunshade next to the ATM is a reminder of a time when the air was strong with menace.
On a lighter note, the toyshop is festooned with glum-looking dolls in the shade as if to announce the lynch mob’s presence in the neighbourhood. For the boys are sets of saloon cars and pistols – all made in China.
One or two pedestrians insist on blocking the narrow thoroughfare between a vegetable shop display and metal shelves belonging to the bakery next door. No one seems aware of passers-by as the cost of a kilo of tomatoes is so much more important than making way for one’s fellow in a hurry.
By the way, the price of vegetables has risen by at least 20 per cent in recent weeks. This is not due to wholesalers and retailersusing the rising dollar-Egyptian pound exchange rate as an excuse for price hikes.
Rather, the cost of fuel has increased and the extra is passed on to everyone else. Indeed, the opening of World Cup 2018 musthave been a good day to bury the bad news that the fuel subsidy was to be lifted.
Business must have been brisk for the butcher’s today: only two pieces of rump are left in the glass-fronted display cabinet. There must have been a whole side of beef hanging outside the shop seven hours before.
The smells of herbs and spices from the shop next door transport one to the world of One Thousand and Twenty-five Nights. (The increase is due to the rising dollar- Egyptian pound exchange rate.) Between a bushel sack of cumin and another of kuzbara is a bag of pasta of the penne variety.
Loitering at a display of crisps are a mother and three children who do not look as if they have been to school today.
Or perhaps they finished early and had time to change into more trendy gear. Their matronly parent watches them select the most expensive snacks, telling them to replace the bags and choose something af Dal (better, i.e. smaller and cheaper). Eventually, no money changes hands and the youngsters move off crispless.
An alleyway between two buildings has become a building site. Brick dust and cement are everywhere and laths of wood of the same inconvenient length – obstacles for the passing pedestrian – lie across the pavement. Sheets of chipboard cut to shape lean patiently against old brick walls to be fitted somewhere. A shop-sign fresh from the makers will soon replace an older, dustier, more battered-looking sign over the entrance.
The cheeping and chirruping and screeching come from the pet shop three doors down. Ginger and black kittens are curled up like ticks in cages. A brown dog of unidentifiable breed lolls and gazes through the bars of its confinement. (Definitely not made in China.)
The English poet William Blake wrote “A Robin Redbreast in a cage/Puts all Heaven in a rage.” Goodness knows what the mood upstairs must be. But spare a thought for the creatures that will need feeding. Bear in mind that imported pet food will be more expensive owing to the rising dollar/Egyptian pound exchange rate.
Mind your head as you pass by the household goods emporium. Those brightly coloured brooms and dust-pans with long handles – probably locally made but putting up a good fight against the Chinese-made variety – proclaim spickness and spanness for all. The orange dusters will not stay orange for long, but when was the last time you saw a yellow sponge with a green rectangle of abrasive material to cut through the toughest grease and burnt-on penne?
That tradition and cutting-edge technology rub shoulders in the same street is surprising. Next to the brooms and flip-top litter bins you can put yourself in touch with anyone in the known universe courtesy of those nice people in China. The name ‘Huawei’ can translate “splendid, magnificent” but it may also mean “ethnically Chinese”. Note the smell of cigarette smoke wafting out of the establishments that sell both new and used devices. That such goods have a second-hand market is a sign of the times.
The reek of dried fish assaults the nostrils. As you pass by, you can see what look like fish tanks with grey eels that seem to have dozed off and sunk to the bottom. Competing poorly with their odour is the egg shop, of which the stock bears the stains and substances accompanying oviparous birth.
Elsewhere, eggs are washed to render them more attractive to the customer, whereas the brown bits and the occasional scrawny feather are guarantees of freshness. A poor third are the smells of sheesha tobacco at the next shop.
Despite the need for second jobs, the rising dollar-Egyptian pound exchange rate, the rocketing fuel costs, the deluge of Chinese imports – bright, bristly, or bristling with apps – life goes on and little changes for most of the population, apart from the shrinking value of the pound in their wallet.
Will the man sitting on the wall outside a furniture store and selling packs of tissues for LE2 still be there in five years’ time?
Will you still be able to buy a pair of sunglasses off the pavement by the photocopy shop in Triumph Square in the year 2025? Probably.
LONDON, Sept 18, 2018 (News Wires) - The dollar held near seven-week lows against its rivals on Tuesday while riskier currencies gained after US President Donald Trump escalated his trade war with China by imposing 10 per cent tariffs on about $200 billion worth of Chinese imports.
While the greenback has benefited from safe-haven flows amid the escalating Sino-US trade conflict in recent months, the rare spot of weakness in the dollar overnight raised concerns about whether investors are starting to worry about the broader impact of the tariffs on the US economy.
With the latest US moves widely anticipated by global markets, investors awaited the Chinese response to the latest measures and pushed the dollar below a key technical level, potentially opening the door to more losses.
"Unless we see these trade wars start hitting the US consumer directly, this might continue further and we will have to see what the Chinese response will be," said Talib Sheikh, head of multi-asset strategy at Jupiter Asset Management.
The dollar index popped up to 94.607 in the early Asian session but gave up its gains to turn lower on the day. It stabilised at 94.57 after falling to 94.35, its lowest since the end of July.
With Beijing keeping a firm grip on the renminbi in the aftermath of the latest measures and refusing to let it weaken sharply, sentiment was more optimistic towards emerging market currencies and equities.
Stocks in China ended up nearly 2 per cent.
RIYADH, Sept 16, 2018 (News Wires) - Saudi Arabia's economy can achieve an International Monetary Fund forecast for 1.9 percent gross domestic product growth this year if all indicators remain unchanged, central bank governor Ahmed al-Kholifey told a news conference on Sunday.
After annual consultations with the Saudi government last month, the IMF predicted Saudi Arabia's gross domestic product would grow 1.9 percent in 2018 partly because of higher oil output, after shrinking 0.9 percent last year.