Dollar on track for 1% weekly gain; sterling went down 2.4%

Today, Dollar was on trailled for a weekly gain of over 1 per-cent against a basket of currencies after a chorus of US Fed Reserve officials indicated more interest rate increases than the market had been pricing in.

The latest was St. Louis Fed President James Bullard, who told in reports on yesterday that another US(United States) interest rate increase "may not be far off" & noted labour market improvement.

The dollar index, which tracks the greenback against a basket of six rival currencies, added about 0.2 per-cent to 96.285. It was assured to increase by 1.3 per-cent for the week, its first such gain this month.

The US dollar edged up 0.1 per-cent as compared to yen to 113.04 . It went up by 1.3 per-cent for the week and well above previous week's 17-month low of 110.67 yen.

The euro slipped by 0.1 per-cent to $1.1162, below last week's one-month peak of $1.1342. It was on track to lose by 0.9 per-cent in a week marred by attacks on Brussels for which Islamic State claimed responsibility.

Sterling went last down 0.3 per-cent at $1.4113, on track for a 2.5 per-cent loss on the week.

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Commodity tips, Indian Rupee unlocked higher by 3 paise

INR(Rupee) unlocked higher by 3 paise and was trading at 67.75 against the US dollar. Click for Commodity tips The local currency ended at 67.78 on Friday last week.

Most other Asian markets traded mixed. Japan's Nikkei surged over 2 per-cent in trade while South Korean Kospi was up 0.22 per-cent. Hong Kong's Hang Seng index traded lower by a per-cent. Mainland China's CSI 300 index was down 1.5 per-cent after January manufacturing PMI data showed weakness for sixth month continuously.

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People's Bank of China bolsters Yuan for 5th back to back day

People's Bank of China bolsters Yuan for fifth consecutive day today via its fix, most probably in an attempt to keep it balanced against Dollar and against basket of currencies. Yuan's movement just few weeks back, might have spooked that Chinese government, when Yuan dropped to lowest level in 5 years and spread between offshore and onshore counterpart widened to record More 2%.


Today, People's Bank of China strengthen fix by 0.01% to Yuan 6.5528 per Dollar.


Latest movement in Yuan indicates that People's Bank of China might be micro-managing the currency. In last nine trading days USD/CNY has lurked from 6.587 to 6.552/$.


It has taken other steps to curb excessive shorting of Yuan, especially in Hong Kong market. It is regularly draining monetization from that market via state run banks and requested information on transactions and activity of speculators and to restrict lending.


China's state run media has also taken fire and swords to speculators, even of a well known billionaire investor Mr. George Soros, known as man who broke Bank of England.


People's Bank of China's efforts however had little impact on offshore Yuan for past five days, which is not that volatile anymore but spread is again rising from parity.

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Rupee went down by 4 paise to 66.86 7 Jan, 2016

Today, the INR(rupee) went down by 4 paise to 66.86 as compared to the US dollar in early trade on Thursday after the Chinese central bank, PBoC, set the yuan midpoint to its lowest & weakest level since March 2011.

The People's Bank of China fixed the official guidance rate 0.5 per-cent weaker than Wednesday's fix of 6.5314, which is its biggest daily fall since 2015's August month. The Chinese yuan fell down by 0.39 per-cent to 6.58 against the greenback.

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