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Emerging Currencies

GCC Ponders Revaluation

The three rules of monetary policy- goes the old adage- are inflation, inflation, inflation.  Well, maybe not.  But that is certainly the story in the Middle East; Saudi Arabia's official inflation rate is the highest in 12 years, and Qatar and the UAE have witnessed double-digit percentage increases, in annualized terms.

Commentary: Yuan et al Must Appreciate

Although the Chinese Yuan is ostensibly allowed to fluctuate in value, the reality is that the size of its fluctuations and the pace of its appreciation are tightly controlled by China's Central Bank.  Since its currency is still effectively fixed to the Dollar, China is severely curtailed in its ability to conduct monetary policy and must closely mirror US policy.  Same goes for the rest of Asia, excluding Japan.

Israel Considers Intervention

The Israeli Shekel has surged over 15% against the Dollar in the last six months, and by over 20% in the last two years.

Dollar Benefits from Risk Aversion

As talk and evidence of a US economic recession builds, the Dollar has witnessed a slight upswing.  How to explain these seemingly contradictory trends?

India Projects Forex Reserve Growth

Those who make a living tracking and
betting on the foreign exchange reserves of Central Banks officially have a new player to
keep tabs on: India.  Nearly 17 years ago, India's reserves dipped
below $1 Billion, and government ministers began sounding the alarm
bells. In comparison, fiscal 2007 witnessed a rise of $47 Billion in India's reserves, bringing the total to $280
Billion.  The government is projecting an
even greater increase in 2008, estimated at $100 Billion.  Now, the
challenge is what to do with all of the reserves; investors will

Kiwi Rises and Falls with Risk Aversion

Most of the world's major currencies are affected by a variety of technical and fundamental factors, such that only taking into account one factor is tantamount to using P/E multiples as the sole basis for purchasing shares of stock.

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