Stocks were weaker in most major Asian markets Wednesday, with
Turkey’s financial crisis showing little sign of abating as Ankara hiked
tariffs on several US goods in a tit-for-tat move.
Following a day of gains on Tuesday, investors were again in a
bearish mood, driving down markets in Tokyo, Hong Kong and Shanghai, but
the Turkish lira was spared the free fall of recent sessions.
The main Japanese market, the Nikkei 225, erased early gains to close
0.68 percent down on the day, giving back some of the ground made on
Tuesday when it jumped by more than two percent.
The Hang Seng in Hong Kong was off more than 1.5 percent and the
losses were even deeper in Shanghai, which was in the red by more than
two percent as disappointing economic data continued to weigh on the
market.
The Turkish lira avoided the kind of dizzying drops seen in recent
days but still experienced some frantic trading when Ankara announced a
rise in tariffs for certain US imports.
Turkey’s vice president said the hikes were ordered “within the
framework of reciprocity in retaliation for the conscious attacks on our
economy by the US administration”, as the war of words between the two
NATO allies intensified.
Rodrigo Catril, senior foreign exchange strategist at National
Australia Bank, said the Turkey crisis was likely to go on for some
time.
“It is hard not to see the lira remaining under pressure until we see
a material fiscal restraint to cool down the economy, along with a
measurable lift in rates by the central bank and a diplomatic resolution
to US tensions,” said the analyst.
The Turkish unit had been under pressure for weeks over growing
concerns about the health of the economy but the currency slumped on
Friday and Monday, when US President Donald Trump announced Washington
was ramping up aluminium and steel tariffs.
In late Asian trading, the lira was at 6.2050 against the dollar,
having recovered significantly from the record lows of 7.24 seen on
Monday.
Traders fretted that Turkey’s woes could spark contagion into other
emerging currencies and also that banks in advanced nations could suffer
due to exposure to the Turkish economy.
“While the lira is stabilising, investors are still concerned that
the crisis will spread to other emerging economies and currencies,” said
Hikaru Sato, senior technical analyst at Daiwa Securities.
“Trading is expected to remain nervous for now.”
However, not all was doom and gloom in Asian markets, with Seoul’s Kospi and the main Australian market up around 0.5 percent.
Monday, August 27, 2018
India’s falling rupee a ‘double-edged sword’ for economy
India’s rupee hit fresh record lows Thursday amid warnings that
benefits to exporters from a weaker currency would be offset by the
higher price paid by Asia’s third-largest economy for oil.
The rupee slid to 70.38 to the dollar just two days after crossing 70 for the first time as India got dragged into the turbulence of the Turkish financial crisis.
The rupee has been steadily falling throughout 2018 after starting the year at 63.67.
The weaker rupee will help India sell goods and its huge services sector in overseas markets, but the country is a massive importer of oil, securing more than two-thirds of its needs from abroad.
Any boost to exports will be offset by pressures on inflation and the current account deficit, said the Association of Mutual Funds in India.
“It is a double-edged sword for the Indian economy,” chief executive N.S. Venkatesh told AFP.
Any optimism that the falling rupee would assist exporters should be tempered with caution, said the Federation of Indian Export Organizations (FIEO).
South Africa, Argentina, Mexico, Brazil and Russia have all seen their currencies slip over the past week because, like Turkey, they remain heavily dependent on dollar-dominated foreign capital.
India’s IT, services and leather exporters may benefit from a weaker rupee — but so do its competitors from their falling currencies.
“We will lose our competitive edge to these economies and profitability from exports will also come down,” FIEO’s Ajay Sahai told AFP.
Analysts say high crude prices are squeezing the Indian currency, making it less appealing to investors.
Brent Crude was at $70.90 per barrel on Thursday, well above prices of around $50 at the same time last year.
The fall in the rupee is leading to a widening of India’s current account deficit, when the value of imports exceeds the value of exports, analysts say.
India’s central bank has raised interest rates twice this year, in part to help increase the value of the rupee.
But the currency can expect more fluctuations until the price of oil and economic conditions in emerging markets stabilise, Mumbai-based independent economist Ashutosh Datar told AFP.
The rupee slid to 70.38 to the dollar just two days after crossing 70 for the first time as India got dragged into the turbulence of the Turkish financial crisis.
The rupee has been steadily falling throughout 2018 after starting the year at 63.67.
The weaker rupee will help India sell goods and its huge services sector in overseas markets, but the country is a massive importer of oil, securing more than two-thirds of its needs from abroad.
Any boost to exports will be offset by pressures on inflation and the current account deficit, said the Association of Mutual Funds in India.
“It is a double-edged sword for the Indian economy,” chief executive N.S. Venkatesh told AFP.
Any optimism that the falling rupee would assist exporters should be tempered with caution, said the Federation of Indian Export Organizations (FIEO).
South Africa, Argentina, Mexico, Brazil and Russia have all seen their currencies slip over the past week because, like Turkey, they remain heavily dependent on dollar-dominated foreign capital.
India’s IT, services and leather exporters may benefit from a weaker rupee — but so do its competitors from their falling currencies.
“We will lose our competitive edge to these economies and profitability from exports will also come down,” FIEO’s Ajay Sahai told AFP.
Analysts say high crude prices are squeezing the Indian currency, making it less appealing to investors.
Brent Crude was at $70.90 per barrel on Thursday, well above prices of around $50 at the same time last year.
The fall in the rupee is leading to a widening of India’s current account deficit, when the value of imports exceeds the value of exports, analysts say.
India’s central bank has raised interest rates twice this year, in part to help increase the value of the rupee.
But the currency can expect more fluctuations until the price of oil and economic conditions in emerging markets stabilise, Mumbai-based independent economist Ashutosh Datar told AFP.
Trade minister unveils plan to make UK export ‘superpower’
Britain will bid to become an “exporting superpower” after Brexit, Trade Secretary Liam Fox said as he unveiled the government’s future export strategy.
The country, which is set to leave the European Union in March next year, will aim to increase exports as a proportion of GDP by five percentage points over the long-term, he announced.Britain sold a record £620 billion ($795 billion, 690 billion euros) of goods and services overseas in 2017, accounting for 30 percent of GDP, boosted by the recent weakness in the value of the pound.
The government and business groups believe it can raise this proportion to 35 percent.
“UK businesses are superbly placed to capitalise on the rapid changes in the global economic environment and I believe the UK has the potential to be a 21st century exporting superpower,” Fox told a business audience in London.
“As we leave the EU, we must set our sights high and that is just what this export strategy will help us achieve.”
The plan comes amid growing anxiety about the impact of Britain leaving the bloc without the prospect of a future trade deal.
This could hamper exports to the EU, Britain’s largest market, if tariff-free trade ends post-Brexit.
Opposition Liberal Democrat leader Vince Cable, a former business minister, called Tuesday’s target unveiling “meaningless” in the current climate.
“The government’s own economic analysis shows that non-EU trade deals would not come close to making up for the loss of EU trade,” he said.
“Relying on a mirage of trade deals with parties outside the EU is at best a gamble, at worst fantastical.”
The government estimates that 400,000 British businesses could export but currently do not, while the CBI believes 10 percent of companies in every region of the country fit that category.
The plan will encourage firms to export with an awareness campaign highlighting up to £50 billion worth of export finance and insurance support on offer.
It will also aim to connect them to “overseas buyers, markets and each other” with more online information and international promotion of British companies.
“This strategy is a first step — a foundation — for a new national drive to export,” said Rona Fairhead, a junior trade minister.
CBI Director-General Carolyn Fairbairn welcomed the plan.
“The CBI has consistently called for a long-term approach to exports,” she said.
“Previous strategies have come and gone, but businesses have been let down by their execution.”
Britain’s export market jumped 11 percent last year, helping to narrow its trade deficit.
But exports fell and imports rose in the three months to June, widening the deficit by £4.7 billion, amid the Brexit uncertainty and global tensions over trade.
DONATION TO EDHI
DONATION
TO EDHI
Cross CHQ Favoring “Abdul Sattar Edhi Foundation”
Can be sent to :
Abdul Sattar Edhi Foundation
17-A Muslim Block,
Allama Iqbal
Town,
Lahore.
Phone: +92 (42) 37806661
Phone: +92 (42) 37806661
OR
Abdul Sattar Edhi Foundation
Sarafa Bazar,
Boulton Market,
Mithadar,
Karachi.
0092 -21 32413232
OR
Can be deposited online in any branch of Banks
in the following accounts:
Habibmetro Bank Ltd
Abdul Sattar Edhi Foundation
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Habib Bank Ltd
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Abdul Sattar Edhi Foundation (Pak Rupees)
Albaraka Bank Pakistan Ltd
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Edhi International Foundation U.K.
| Account Title: | Edhi International Foundation U.K. |
| Account No: | 01466755 |
| Bank Name: | Lloyds TSB Bank London – U.K |
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| Account Title: | Edhi International Foundation U.K. |
| Account No: | 70013779 |
| Bank Name: | Habib Bank Ltd. – UK 65 Whitechapel Road, London E1 1DU |
| Sort Code: | 60-95-11 |
| BIC: | HABBGB2L |
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FOR USA ----- $ Account:
Abdul Sattar Edhi International Foundation
EIN Number: 11-3013369
| Account Title: | Abdul Sattar Edhi International Foundation |
| Name of Bank: | JPMorgan Chase Bank, NA |
| Account No: | 681596222 |
| Bank Add: | 3794, 103rd Street, Corona, NY 11368, USA |
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| Account Title: | Abdul Sattar Edhi Foundation |
| Account No: | 0108-208086754 (Pak Rupees) |
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| Branch Name: | Bombay Bazar Branch – Karachi |
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Abdul Sattar Edhi Foundation (US$)
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| Branch Name: | Bombay Bazar Branch – Karachi |
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Account Title:
|
Abdul Sattar Edhi Foundation
|
||||||||||||||
Account No:
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0010016462880030
|
||||||||||||||
Bank Name:
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Allied Bank Ltd
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Branch Name:
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Merewether Tower Branch – Karachi
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Swift Code:
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ABPAPKKAXXX
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IBAN:PK50ABPA0010016462880030
OR
Abdul Sattar Edhi Foundation (Pak Rupees)
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