Reserve Bank of India (RBI) had provided a special dollar swap window to Indian Oil, Hindustan Petroleum and Bharat Petroleum in late August in order to shore up the rupee. RBI Governor Raghuram Rajan has said that until the public sector companies fully return to the market it couldn’t be described as having stabilised. The market expects the window to be withdrawn in the next few weeks, which could bump up demand for US dollar by more than $400 million a day. Dealers expect a gradual return so that the market can absorb the demand for dollars and there is no sudden exchange rate movement.
FOREX-Euro vulnerable before ECB, hits near 4-week low vs yen
Investigators are also believed to be examining whether traders attempted to influence benchmark foreign exchange rates reported by WM/Reuters by submitting trades during the times when those rates are set. Many money managers, pension funds and other institutional investors rely on the WM/Reuters rates for foreign exchange investments. The foreign exchange investigations represent the latest multinational examination of financial benchmarks that affect trillions of dollars in personal and business transactions. Investigators are also probing evidence that bank traders manipulated the London Interbank Offered Rate, which is used to set rates on mortgages, credit cards, loans and some financial derivatives. RBS’ financial statement also cited the Libor investigations as a potential risk factor that could affect its financial results. The bank, chiefly owned by the British government following a financial bailout, also announced Friday that it would shift approximately $61 billion in bad loans into a newly created internal entity.
The European Union Economic Forecast for the next two years is due out at 10.00 UTC along with the Eurozones Producer Price Index m/m for September (expected to rise by 0.3 percent). ISMs US Non-Manufacturing Purchasing Managers Index for October is due out at 15.00 UTC. Analysts expect a slight decline from the prior 54.4 points. The IBD/TIPP Economic Optimism comes out at the same time and is forecast to rise to 41.1 points for this month from the prior 38.4. Todays resistances: 1.3525, 1.3555 and 1.3585.
Forex: EUR/USD holding to rising channel so far today
It last stood at 80.547, down 0.2 percent on the day. The dollar had risen in Asia after Dallas Federal Reserve Bank President Richard Fisher told a conference of business economists in Sydney he was concerned that corporate credit spreads have narrowed too much. He also said he does not see the Fed’s balance sheet rising to $6 trillion or more. Against the yen, the dollar was last down 0.1 percent against at 98.57 yen. Data on Monday showed orders for a wide range of U.S.-made capital goods sank more than estimated in September, a sign companies cut their investment plans sharply as Washington hurtled to the brink of default.
“The bias is for a weaker euro … The market had got too long of euro/dollar and, given the uncertainty over the ECB, the theme could be some more squaring of short-term positions,” said Paul Robson, currency strategist at RBS. He said a break below chart support at around $1.3445,from a trendline drawn from a low hit in early July, could be a cue for further losses. The single currency rebounded on Monday as a survey showed euro learn more zone manufacturing activity accelerated in October, but these gains proved short-lived. However, with the U.S. Federal Reserve seen likely to hold off from tapering its stimulus until next year and expected to keep interest rates low for an extended period, some analysts said risks of a weaker euro could be limited.
governments 16-day hiatus last month. On the European and Asian economic calendars this week are manufacturing, services, and composite purchasing-managers indices reports. By weeks end, investors can chew on important employment reports from the U.S., Canada, and Australia. The weeks obvious highlight is the American employment report for October. After softer Bureau of Labor Statistics numbers for September, and a sluggish ADP print for October, will the market see enough improvement in the details by Friday morning to allow the Federal Reserve to begin to tighten the liquidity taps soon?
Dollar Retreats To Start Busy Forex Week
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