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Saturday, August 07, 2004

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Dollar falls further against Taka,
euro but gains against yen

The Bangladesh Overbear

The US dollar lost further against Bangladesh Taka in inter-bank trading onThursday due to ‘cautious buying’ ahead of US job data, dealers said, reports BSS.

The dollar fell against the euro on Thursday ahead of weekly US jobless figures and interest rate decisions in Europe, but pressured the yen as oil prices rebounded towards record high levels, they said.

The US payrolls figure is seen as a key to economic growth because hiring helps stimulate income and spending growth.

The US dollar traded at rates between 59.30 Taka and 59.40 Taka today, compared to its previous closing at rates between 59.30 Taka and 59.70 Taka on Tuesday, dealers of some leading commercial banks said.

“The dollar lost grounds as importers have become very cautious about dollar which is soaring ahead of weekly US jobless figures and interest rate decisions,” the dealer of a leading private bank said.

Other dealers said normally the dollar shows upward trend on Thursday due to weekend demand. Many dealers squired their positions in dollars before long weekend holidays both in domestic and international markets.

“But today, it was quite different.”

Friday is the weekend holiday in local market while most international foreign exchange markets enjoy weekend holidays on Saturday and Sunday, he said.

Dealers said the euro rose to 1.2060 dollars in global trading today from 1.2046 late on Wednesday in New York, but the dollar rose to 111 yen from 110.51.

“US employment data are beginning to loom large on the horizon, impeding the dollar’s ability to continue its push higher,” said dealer of a US-based bank.

The consensus forecast for Friday’s US July employment report calls for a 260,000 increase in non-farm payrolls after a lacklustre 112,000 gain in June.

Fresh investor concerns about US job growth emerged after the Institute for Supply Management’s employment sub-index slumped to 50.0 in July from 57.4 in June.

The Japanese yen was, meanwhile, weighed down by the impact of soaring oil prices, which resumed their march Thursday. Japan is a 100 per cent net importer of oil so a surge in dollar- denominated prices tends to hurt its currency.

The UK pound was firm ahead of the Bank of England’s latest interest-rate decision, dealers said. The UK central bank decided to hike rates by a quarter point to 4.75 per cent, its fifth such rise since November to help to cool the British economy as consumer debt shows no sign of easing.

In late trade, the euro was changing hands at 1.2060 dollars from 1.2046 late on Wednesday in New York, 133.89 yen (133.88), 0.6613 pounds (0.6595) and 1.5384 Swiss francs (1.5369).

The dollar stood at 111 yen (111.10) and 1.2758 Swiss francs (1.2763) and the pound was at 1.8248 dollars (1.8251), 202.58 yen (202.76) and 2.3276 Swiss francs (2.3293), according to AFP data.

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