Weekly Currency Roundup

April 26-30, 2009
International Markets:
The international markets continued to remain volatile this week. Concerns about the Swine flu contributed to an increase in risk aversion and weighed on investor sentiment. The Mexican peso fell 3 pct versus the dollar, and hit a 3-week low after reports of the outbreak surfaced. The WSJ report on Bank of America and Citigroup further contributed to the strength of the yen and the d +ollar, which tend to rise in times of risk aversion. By the end of the week the dollar fell broadly, hitting a three week low against a basket of currencies as speculation the global economic downturn is slowing continued to raise demand for riskier assets. The euro climbed along with high-yielders as investors looked beyond a weak headline reading of US growth and focused on signs the economy may soon pick up, an outlook suggested by the Federal Reserve in its policy statement on Wednesday. This kept intact a broad, ongoing improvement in market sentiment and risk demand, which analysts said would continue so long as economic data does not significantly alter the view that the global economy is starting to show signs of recovery. Concerns about the spread of swine flu waned on the view that the disease thus far would have limited economic impact, and a report of an imminent bankruptcy filing by Chrysler did little to stifle the risk rally, with analysts saying that markets have already priced in the US automaker's failure.
Local Market FX:
The USD remained steady against the BDT throughout the week. The market was active and there was ample liquidity.
Local Money Market:
The call money rate was stable and traded in the 0.25-0.50 range. Excess liquidity was the primary cause of such low rates.
This memorandum is issued by Standard Chartered Bank and is based on or derived from information generally available to the public from sources believed to be reliable. While all reasonable care has been taken in its preparation no responsibility or liability is accepted for errors of fact or any opinion expressed herein.