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BenjaminFX
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USA and France call for open trading of China’s Yuan
Concerns over the low value of China’s Yaun have been raised by Nicolas Sarkozy, the President of France, saying that the time has come to internationalize the currency during the meeting of the Group of 20.
Mr Sarkozy has called for China’s currency to be added to the International Monetary Fund’s Special Drawing Rights, a unit of account derived from the value of the US Dollar, Yen, Sterling and the Euro.
The Special Drawing Rights were created by the IMF in 1969 to support the Bretton Woods fixed exchange rate system.
A country participating in this system needs government or central bank holdings of gold and widely accepted foreign currency that could be used to purchase the domestic currency in the foreign exchange markets, a requirement to manage the exchange rate.
The US and other countries joined the dispute that with out making the Yaun widely available, China is keeping its currency artificially cheap, giving Chinese exporters an unfair advantage in international markets.
Timothy Geithner, the US Secretary of Treasury, told a panel at the G20 meeting that easing controls on exchange rates and shifting to more open policies would be necessary to help manage global inflation.
Chinese officials avoided addressing the currency issue and instead made vague calls for a gradual change to the global system.
Focus on European Interest Rate Increases
Speculation over the Euro zone raising the base level of the cast of borrowing could be drawing to a close as most economists expect the European Central Bank will vote to increase the 1 percent level in April.
The ECB Interest rate hike is essentially a move to curb the rising costs of food, services and fuel as inflation hit 2.6 percent this month, which is over the central banks 2 percent target.
Aside from the multi billion Euro bailout package offered to Greece, Ireland and potentially Portugal, the 17 nation currency is trading at its strongest levels since October 2010.
A surge of safe haven trading has gone in favour of the Euro following recent Middle and Far East issue, and with continued positive data from Germany it is expected to see ongoing support.
Foreign Exchange Rates Table
Currency Pairs Current Mid-Rates at 9.00am
GBP - EUR 1.1376
EUR - GPB 0.8790
GBP - USD 1.6136
EUR - USD 1.4184
GBP - AUD 1.5617
GBP - CAD 1.5670
GBP - NZD 2.1190
GBP - CHF 1.4777
GBP - HKD 12.5630
GBP - NOK 8.9540
GBP - SEK 10.1554
GBP - ZAR 10.9490
GBP - THB 48.83
GBP - AED 5.9280
GBP - MAD 12.8601
GBP - ILS 5.6406
GBP - TRY 2.4942
GBP - JPY 133.64
Concerns over the low value of China’s Yaun have been raised by Nicolas Sarkozy, the President of France, saying that the time has come to internationalize the currency during the meeting of the Group of 20.
Mr Sarkozy has called for China’s currency to be added to the International Monetary Fund’s Special Drawing Rights, a unit of account derived from the value of the US Dollar, Yen, Sterling and the Euro.
The Special Drawing Rights were created by the IMF in 1969 to support the Bretton Woods fixed exchange rate system.
A country participating in this system needs government or central bank holdings of gold and widely accepted foreign currency that could be used to purchase the domestic currency in the foreign exchange markets, a requirement to manage the exchange rate.
The US and other countries joined the dispute that with out making the Yaun widely available, China is keeping its currency artificially cheap, giving Chinese exporters an unfair advantage in international markets.
Timothy Geithner, the US Secretary of Treasury, told a panel at the G20 meeting that easing controls on exchange rates and shifting to more open policies would be necessary to help manage global inflation.
Chinese officials avoided addressing the currency issue and instead made vague calls for a gradual change to the global system.
Focus on European Interest Rate Increases
Speculation over the Euro zone raising the base level of the cast of borrowing could be drawing to a close as most economists expect the European Central Bank will vote to increase the 1 percent level in April.
The ECB Interest rate hike is essentially a move to curb the rising costs of food, services and fuel as inflation hit 2.6 percent this month, which is over the central banks 2 percent target.
Aside from the multi billion Euro bailout package offered to Greece, Ireland and potentially Portugal, the 17 nation currency is trading at its strongest levels since October 2010.
A surge of safe haven trading has gone in favour of the Euro following recent Middle and Far East issue, and with continued positive data from Germany it is expected to see ongoing support.
Foreign Exchange Rates Table
Currency Pairs Current Mid-Rates at 9.00am
GBP - EUR 1.1376
EUR - GPB 0.8790
GBP - USD 1.6136
EUR - USD 1.4184
GBP - AUD 1.5617
GBP - CAD 1.5670
GBP - NZD 2.1190
GBP - CHF 1.4777
GBP - HKD 12.5630
GBP - NOK 8.9540
GBP - SEK 10.1554
GBP - ZAR 10.9490
GBP - THB 48.83
GBP - AED 5.9280
GBP - MAD 12.8601
GBP - ILS 5.6406
GBP - TRY 2.4942
GBP - JPY 133.64
