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Oil falls below $72 as dollar gains...
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Oil falls below $72 as dollar gains...
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UPDATE 6-Oil falls below $72 as dollar gains...
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Economic Indicators

Economic IndicatorsEconomic Indicators Annual 2007/08
Foreign Debt $45.00bn
Per Cap Income $1085
GDP Growth 5.8%
Average CPI 12.00%
Monthly February

Trade Balance $-857 mln
Exports $1.26 bln
Imports $2.12 bln
Weekly May 18, 2009
Reserves

Forex Brokers of Pakistan

Dollar East Exchange Company

Head Office Address: 97-A Jail Road, Lahore, Punjab 74000
Telephone: +92-42-7555616
+92-42-7598529
Fax: +92-42-7555615

Read more: Dollar East Exchange Company



H & H Exchange Co. (Pvt) Ltd.

Head Office
Address: Suite # G-17, Ground Floor, Saima Trade Tower, Dr. Ziauddin Ahmed Road
Karachi, Sindh 74000
Telephone: UAN : 111 44 00 44
+92.21.2212882-89
Fax: +92.21.2212890


GLAXY EXCHANGE (PVT.) LTD

Head Office
Address: S/No. 10 & 11, Sasi Arcade, Opp. Uzma Shopping Plaza, Blk-7, Clifton, Khi
karachi, Sindh 74000
Telephone: +92-21-5875141


Read more: GLAXY EXCHANGE (PVT.) LTD



Emirates Global Islamic Bank Limited (EGIBL)

Head Office
Address: Shopping Arcade, Karachi Sheraton Hotel & Towers, Club Road, Karachi.
karachi, Sindh 74000
Telephone: +92-21-111113442

Read more: Emirates Global Islamic Bank Limited (EGIBL)



Khanani & Kalia International (Pvt.) Ltd.

Head Office
Address: Suite # 1101-1105, 11th Floor, Block-A, Saima Trade Tower I. I. Chundrigar Road.
Karachi, Sindh 74000
Telephone: +92-21-111-554-003
+92-21-2217001-10
Telex
27489KKI.PK
Fax: +92-21-2218094
+92-21-2218087


Read more: Khanani & Kalia International (Pvt.) Ltd.



ZARCO EXCHANGE COMPANY (PVT) LTD.

Head Office
Address: 32-A Lawrence road,
Lahore, Punjab
Telephone: 0800-12345, 0800-67890
+92-42 6301253, 6301977

Fax: +92-42 6368796, 6362217



Read more: ZARCO EXCHANGE COMPANY (PVT) LTD.



A Khanani and Kalia Money Exchange

Islamabad Office
Address: Unit # 1, Chowdry Plaza, Blue Area, Opp. Nafdeck Cinema .
Islamabad, Punjab 74400
Telephone: +92-51-111-554-554
Fax: +92-51-2274457


A TO Z MONEY CHANGER

Head Office
Address: 184,Paradise Shopping Centre,Saddar
karachi, Sindh 74000
Telephone: (92 21) 5686968
(92-21) 5686650

Pakistan Open Market Exchange Rates

Pakistan Open Market Exchange Rates
update on Sat, Jun 13 2009, 10:16 PST (GMT+5)

Currency Buying Selling
Australian Dollar 65.3 66.3
Bahrain Dinar 213.4 215
Canadian Dollar 72.4 73.4
China Yuan 11.25 12
Danish Krone 15.1 15.4
Euro 112.8 114.5
Hong Kong Dollar 10.32 10.52
Indian Rupee 1.6 1.7
Japanese Yen 0.82 0.83
Kuwaiti Dinar 275.2 277
Malaysian Ringgit 22.2 22.8
NewZealand $ 50.4 51.4
Norwegians Krone 12.6 13
Omani Riyal 208.6 210
Qatari Riyal 22.05 22.3
Saudi Riyal 21.4 21.6
Singapore Dollar 55.1 56.1
Swedish Korona 10.4 10.8
Swiss Franc 74.5 75.5
Thai Bhat 2.2 2.4
U.A.E Dirham 21.95 22.15
UK Pound Sterling 133 135
US Dollar 80.95 81.25



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Forex Technical

Forex Technical
Trend Reversal Patterns

Head and Shoulders
The Head and Shoulders pattern is one of the most classic patterns in a technical analyst’s toolkit. This three-peak formation is named for its resemblance to a head and two shoulders. The center peak (head) protrudes above the remaining two peaks (shoulders), which are set at or close to identical levels. The common line of support for all three peaks, which does not have to be a horizontal line, is known as the Neckline. The final downward penetration of the neckline confirms the start of a new downward trend.

There is a chance that even after there is a break of the neckline that the trend may not reverse. A good validation of a reversal would be if the break is significant or if the neckline is tested and it turns from support to resistance. Also, a trader should look and see if momentum was higher during the formation of the left shoulder compared to the right shoulder as this would indicate that buying pressure is decreasing and a true reversal pattern is taking place. During a true head and shoulders reversal, the downward move can be expected to be equal to the distance from neckline to head.

Read more: Trend Reversal Patterns



Various Tops and Bottoms

Double Top
A double top is formed when the price of a pair in an uptrend rises and encounters resistance. Following this, price retreats to a support level which will become the neckline and subsequently returns to the resistance level. After failing to break the resistance level a second time the pair falls back down. At the neckline price breaks down into a new downward trend.

A real life example of a double top is presented below

Read more: Various Tops and Bottoms



Flags & Rectangles


Flags Formations

Flags are a type of short-term pause in the dynamic and progressive movement of a market trend. Flags are usually marked by a sharp, almost horizontal entry into the pattern. Flags are bound by parallel lines of support and resistance. The pattern is commonly followed by a sharp break back into the prevailing trend. Flags have a tendency to form slanted in the direction opposite to the major market trend they inhabit.

Read more: Flags & Rectangles



Chart Triangle

Symmetrical Triangle

A symmetrical triangle is indicative of a period of consolidation during an uptrend or a downtrend. The symmetrical triangle has a line of support that slopes upwards and a line of resistance that slopes downward. The triangle pattern yields to a breakout in the direction that corresponds with the trend beforehand, though not always.







Read more: Chart Triangle

Pakistan Open Market Forex Rates

Pakistan Open Market Forex Rates
Updated at : 13/6/2009 11:12 AM (PST)

Currency Buying Selling
Australian Dollar 65.30 66.30
Canadian Dollar 72.40 73.40
China Yuan 11.25 12.00
Euro 112.80 114.50
Japanese Yen 0.8180 0.8280
Saudi Riyal 21.40 21.60
U.A.E Dirham 21.95 22.15
UK Pound Sterling 133.00 135.00
US Dollar 80.95 81.25

Forex Rates - Pakistan

Forex Rates - Pakistan


Updated at: 6/13/2009 11:47:15 AM (PST)
Arrows in the chart show price change compared with the last updated rate.
Following are indicative cash currencies rates
Courtesy by: ECAP








Remittance Buying Selling
US Dollar TT 0 0
US Dollar DD 0 0
Currency Notes
Australian Dollar 65.08 65.48
Bahrain Dinar 212.96 210.1
Canadian Dollar 71.63 72.22
China Yuan 0 0
Danish Krone 15.06 15.18
Euro 112.3 115.23
Hong Kong Dollar 10.22 10.44
Indian Rupee 1.58 1.68
Japanese Yen 0.8139 0.8193
Kuwaiti Dinar 277.87 282.03
Malaysian Ringgit 0 0
NewZealand $ 43.5 43.8
Norwegians Krone 12.62 12.73
Omani Riyal 208.63 210.01
Qatari Riyal 21.98 22.29
Saudi Riyal 21.47 21.57
Singapore Dollar 0 0
Swedish Korona 10.23 10.33
Swiss Franc 74.31 74.82
Thai Bhat 0 0
U.A.E Dirham 21.91 22.04
UK Pound Sterling 131.91 134.64
US Dollar 80.8 81.1

Forex Exclusive

Forex Exclusive

Syed Nabeel Iqbal
Manager Marketing
Khanani & Kalia International (Pvt.) Ltd.

First ISO 9001 Certified Exchange Company In Pakistan




Rupee on a downhill ride in the current fiscal
An overview of rupee’s depreciation since 1st July 2004-17th Aug 2004


Actually speaking, rupee is under severe demand pressure since the start of current fiscal year and has lost around 1.40 percent so far. The rupee has been suffering with a weakening trend in the local currency market, both in the inter bank and the kerb, but its pressure seems to be more intense in the official market. Mainly the importers, oil companies are buying dollars in heavy volumes from the banks while the commercial importers are doing forward booking. Both these segments of the market has constituted very heavy demand thus making rupee to depreciate at a fast pace. According to the bankers, the high demand of currency is putting a lot of pressure on the national currency and the same trend is expected to continue in the coming days as well.

The bankers have chalked out three major reasons for rupee’s 1.4% loss this fiscal year so far including;

• Oil payments demand in advance by oil companies,
• Rising international oil prices and
• Exporters holding back their proceeds to gain higher profits.


The bankers said the federal government has announced to pre-pay another $1 billion loans owed to multi-lateral donors by December, which would also increase dollar demand. They further added that there are a number of other payments, which are in the pipeline, and that banks have been requesting companies to delay these payments.

According to one source, more or less, speculative buying of dollar was taking place from the importers since few days with the risk that rupee is going to depreciate further in the coming days and this is one of the most significant factor in rupee’s fall in country’s official market. Pakistan's trade deficit soared to $3.2 billion, more than three times the 2002-03 deficits of $1 billion. The most important element in this huge trade deficit was that half of it had accumulated in the last quarter thus resulting in a 0.61 paisa loss in the price of rupee during April-June 2004. the falling trend of the national currency continued and dollar went on getting stronger when the trade deficit reached $189 million in July. At this stage, the market was anticipating it to be much higher, keeping in mind the average monthly deficit of more than half a billion dollars in April-June 2004.

This anticipation actually forced the importers to make forward dollar buying to avoid exchange rate loss. At the same time, the monetary policy statement of the State Bank issued on July 21 indicated clearly that the rupee might remain under pressure in July-December 2004. The policy further revealed that during July-May 2003-04, the overall balance of payments surplus had fallen by 70.7 strengthened importers' view that it was time for them to purchase forward dollars to avoid exchange rate loss in future. To add further, the trade policy for 2004-05 issued by the ministry of commerce on July 22 also made it clear that achieving the policy objectives would depend, among other things, on "competitive exchange rates" and thus the importers to do some forward buying to avoid losses in the future.

However, the active movement of SBP by taking certain actions is clear evidence that the central bank wants to maintain stability in the value of rupee even in case of severe demand and heavy repayment schedules. The main point of concern for the State Bank is to keep the value of rupee under the psychological level of Rs. 59/00 and for this reason; SBP has been doing regular intervention and mopping up excess liquidity from the market. This is necessary for the country as a whole since if rupee is allowed to depreciate at such a fast pace, it would not only increase the cost of imports and external debt servicing in terms of rupees, but would also fuel imported inflation over medium term. Not only this, it would also provide incentive for dollarization of bank deposits and shift some investment from the stock market to those areas of economy that lack proper documentation like the real estate. However, another source identified last week that the bankers are of the view that rupee would continue to depreciate at a rapid pace and is likely to fall below Rs. 62/- mark by the end of this year. The report defended its statement by saying that this price value will be backed by increased demand from the oil importing companies and the government’s plans to retire $1 billion expensive loans ahead of schedule.

On the other hand, the banking system of the country continues to face excess liquidity and thus the SBP once again is set to suck in the same in yet another open market operation on 18th August. The State Bank of Pakistan (SBP) has given a pre-auction target of Rs 35 billion for the sale of six-month Treasury bills at a regular auction. The market is stated to be in surplus to the tune of Rs7-8 billion and thus an action is necessary. The State Bank conducted an open market operation on 10th of August, and sold Treasury bills under one-week and two-week repurchase agreement. The bank raised Rs3.175 billion at 1.25 per cent through repo sale of the TBs - Rs3 billion for one-week and Rs175 million for two-weeks - against the total demand of Rs6.425 billion by the banks. For tomorrow’s auction, the bankers are saying that there is no maturity against the auction but treasury bills worth Rs 35.75 billion would be matured this week from previous open market operations. They further said the central bank is likely to raise slightly cut-off yield on the six-month to control rising inflation in the country.

And finally a good news! Pakistan is considering allowing national commercial banks to open their branches in India. According to a news source, it was decided rather hinted in last week’s trade talks, which were part of the ongoing composite dialogue between Pakistan and India. The sources identified that since the developing relations between India and Pakistan especially in the last few months can be a green signal to the Pakistani banks as well to start their operations. Opening up bank branches across borders was found to be a way to enhance trade and economic cooperation between the two countries, sources added.


Forex Exclusive Archive

v Budget 2006 Highlights

v Finance Bill 2006
Economic Survey of Pakistan 2005-06

The Economic Summary Of Pakistan 2004

No Resolution Seen For Dollar Gloom

First Quarterly Report 2004-05

Euro and Pound Sterling set new highs in the kerb

Financial Markets Review

Pound Sterling hits all time highs in the kerb

Latest macro economic indicators

Import bill rises further

Rising Oil Prices; A Serious Matter Of Concern

Greenspan: Global Recovery Strengthening
An overview of rupee’s depreciation since 1st July 2004-17th Aug 2004
Pak exports to EU to receive another blow?
Saddam Captured; A battle won or lost?
Regionalism: Catalyst or snag to global free trade?
Can GWADAR rescue Pakistan's dwindling export?

Inter Bank Comments

Inter Bank Comments


On Friday, 7th Nov 2008










Rupee depreciates versus greenback in the interbank dealings


Bearish trend continued to prevail in the dealings as rupee shed 0/30 paisas versus dollar amid demand of US currency rose. The US dollar started off new day’s trading at Rs.80/80, gained more grounds and was changing hands at Rs.81/10 at close of markets on Friday.

On the international desks, the dollar fell against the euro and the yen on speculation a government report will show the U.S. economy lost the most jobs since 2003, bolstering the case for the Federal Reserve to lower interest rates.

The U.S. currency also declined versus the British pound as futures traders increased bets the Fed will cut borrowing costs by half a percentage point to 0.5 percent compared with a benchmark rate of 3 percent in the U.K. A Labor Department report today may also show the unemployment rate in the U.S. rose to a five-year high as the global economic downturn deepened.

The dollar fell to $1.2753 per euro at 2:07 p.m. in Tokyo from $1.2715 late yesterday in New York. Against the pound, it declined to $1.5683 from $1.5627. The U.S. currency bought 97.53 yen from 97.75. The euro was little changed at 124.35 yen. The dollar may fall to $1.2830 versus the euro today, Ito said.








INTER BANK COMMENTS ARE UPDATED DAILY

Text of Trade Policy 2004-05

Monetary Policies
Trade Policy 2003-04 | Trade Policy 2004-05
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Text of Trade Policy 2004-05




Commerce Minister Humayun Akhtar on Thursday announced Trade Policy 2004-05 in Islamabad. Following is the text of the policy:

1. I deem it an honour and a privilege to be presenting to you the trade policy of Pakistan for the fiscal year 2004-2005. I have this honour for the second time since our Government assumed office in 2002.

2. For Pakistan to achieve the desirable rates of growth, the Government must follow appropriate and consistent economic policies. It is fortunate, that from the beginning of his government in 1999, President Musharraf assigned the highest priority to economic revival and initiated a forward looking reform agenda. The parameters laid down in the President’s economic reform agenda have of course guided economic policy over the past five years. Due to this correct direction and consistency of policy, Pakistan’s economic indicators, including export figures, are the best they have ever been.

REVIEW OF EXPORTS 2003-2004

3. Between 1982 and 2003, global exports had increased by 397% to US $ 7.482 trillion. Pakistan’s exports in the same period increased by 496% i.e. from a share of 0.13% to 0.16%, a 23% increase in world market share. Whilst a turn around in Pakistan has been achieved with export growth rate being 22% more than the growth rate of the world trade, significant potential still awaits us. Exports achieved during 2003-2004 were US$12,273.5 million registering an increase of 10% and surpassing the budgeted level of US$12.1 billion. This is the third consecutive year of year-on-year growth and the achievement of target levels. Compared to 1999-2000, exports have increased by 43%. In the context of the socio political and economic challenges faced by Pakistan and its private sector, this is more than satisfactory. The people of Pakistan and our business community deserve congratulations for this achievement, which would not have been possible without their effort and dedication.

SECTORAL REVIEW

CORE CATEGORIES (TRADITIONAL)
4. Textiles and Garment’s export were US$8.302 billion. This is 68% of the total exports and an increase of US$844 million, or 11.3%, over 2002-2003. Of the total increase in exports of US$1.113 billion, Textile and Garments contribute 75.8%. It is encouraging to note that five of the sub-sectors namely cotton cloth, knitwear, bed wear, cotton yarn and ready made garments, achieved exports in excess of US$ one billion each. Our ‘Other Core categories’ combined, recorded an export level of US$2.353 billion, which is 19.2% of our total exports, registering an increase of US$99 million or 4.03% over last year. These contributed 8% of our total increase in national exports. Whilst Rice at US$627 million and Petroleum products at US$284 million produced appreciable growth over last year, 12.9% and 14.3% respectively, our other traditional product sectors were lower or declined. Exports of leather & leather products, at US$723 million, were 4% higher, molasses at US$48 million were up 4.7%, carpets at US$223 million increased by 0.2%, sports goods at US$310 million declined by 7.7% as did surgical instruments at US$124 million by 17.3%. Performance of our traditional products, other than textile and garments, posting either incremental gains or decline, is a matter of concern as these currently account for 19.2% of our total exports.

‘DEVELOPMENTAL CATEGORIES’ AND ALL ‘OTHERS’ (NON TRADITIONALS)
5. The non-traditional product categories recorded exports of US$1.618 billion, or 13.2% of our total exports. These grew by US$178 million or 12.4%. However wheat exports distort the true performance and excluding wheat, last year exports of which were US$130 million and this year only US$6 million, our non traditional products recorded exports of US$1.612 billion, which is US$302 million or 23% more than last year. Thus the rate of growth of exports of non traditional products was 130% more than that of Pakistan’s total exports. The base of course is still small.

6. During the period 1999 to 2003, world exports increased by US$1.774 trillion i.e. by 31%. During the same period Pakistan’s exports grew by 43% reflecting an improvement in world share. By comparison India increased by 53%, Singapore by 26%, Malaysia 19%, Indonesia 25%, UAE 5%, Philippine 1%, Vietnam 70%, Iran 59%, Bangladesh 25%, Sri Lanka 10% and Jordon 64%.

7. A turn around in exports has been achieved. However, the absolute value of exports at US$12.3 billion suggests significant opportunities remaining. Pakistan must aim for a quantum leap in the short to medium turn. Question is what would constitute a quantum leap for Pakistan. With a GDP level of US$95 billion, exports are presently 13% of GDP. It is estimated that with a GDP level of US$150 billion in 5 years attained through a 10% growth per annum, if we achieve a 25% of GDP level or US$25 to 30 billion in exports, that would be a quantum change. This is a 15 - 20% growth per annum and a practical but stretch objective which Pakistan should air for.

8. I must mention here that while our exports went up, the value of our imports also exceeded our projection of $12.8 billion by 20.9 percent, resulting in a trade gap of $3.199 billion, which was considerably wider than the year before. The underlying factors for this rise, however are heartening, in that the major increases have been in the import of machinery, chemicals and metals. The nature of these increased imports implies that the level of productive investment and production activity in the economy has increased significantly in response to improvement in the policy environment over the last five years. As higher imports of industrial machinery and raw materials results in greater industrial activity, the consequential benefits are increased employment and hence, reduction in poverty.

9. In today’s global trading environment, economies cannot function in isolation. Therefore it is necessary to have a system of international trade that works for the benefit of all. For such a system to be functional, it needs to be rule based and cater to the interests of all countries irrespective of their level of development. The World Trade Organisation (WTO) represents an effort to put in place such a system which is not only rule based, but one where decisions are taken by consensus.

10. The WTO was established and made operational in 1995. Pakistan has been a WTO member since 1995 and has been complying with its legal obligations under various WTO agreements. At this point I WANT TO reiterate that contrary to popular perception, the WTO regime will not come into effect in 2005 since it is already operational

11. However, what makes the year 2005 especially significant from Pakistan’s point of view is that with effect from 1st January 2005 all remaining quotas on our textile exports will be phased out in keeping with the requirements of the WTO agreement on textiles and clothing. The elimination of textile quotas has been a longstanding objective for us because we enjoy a comparative advantage in this sector. The Textile industry of Pakistan, in collaboration with Government, has been preparing itself by making sizeable investments in order to take advantage of the new market opportunities likely to emerge after the end of the quota regime. Our assessment is that in overall terms Pakistan stands to gain from the abolition of textile quotas.

12. Given the major share and importance of the textile sector in our economy and trade, I would like to inform you about some of the specific supportive measures under taken for this sector:

(a) Sales tax on ginned cotton has been eliminated to reduce costs for the spinning sector.

(b) Ban on import of cotton waste has been removed to help towel manufacturers.

(c) Almost all restrictions on relocation of used textile machinery, and related equipment have been removed to encourage aggressive establishment of enhanced textile production capacity.

(d) Garment Cities are being set up to encourage production and export of value added products.

13. I would like to inform you that presently negotiations are underway to further improve the WTO system and the global trading environment. In these negotiations referred to as the Doha Development Agenda, Pakistan is striving to ensure that the final outcome is development friendly and conforms as closely as possible with our economic objectives. In the most important negotiations i.e. on agricultural trade liberalization, Pakistan, along with other developing countries, is calling upon developed countries to make major reductions in their agricultural tariffs and eliminate their subsidies as this would be immensely beneficial for our agricultural sector, given its predominant position in our economy. At the same time, we are also mindful of the need to ensure protection of our farmers against import surges of low priced agricultural products. Accordingly, we have allied ourselves with a group of developing countries that are calling for a special safeguard mechanism to cater to such eventualities.

14. In the non-agricultural sector, Pakistan and the developing countries are willing for further liberalization, subject to the condition, that their interests would be safeguarded. This implies that developed countries will allow effective market access to the exports of developing countries by eliminating unjustified non-tariff barriers, and specifically by reducing tariffs on labour-intensive products like textiles. A very important condition of these negotiations is that the pace and extent of trade liberalization by developing countries will be lesser than developed countries, and will be in keeping with their capacity, so that their economies are not hurt in the process. Since Pakistan has already reduced its tariffs and non-tariff barriers considerably in pursuit of its own economic reform agenda, we do not foresee the need for any major changes in our current tariff and trade regime as a consequence of new agreements under the Doha Development agenda a few years down the line.

15. Public concern is often expressed about whether the Government is making adequate preparations to meet the challenges and opportunities of the WTO system. On this subject, I confirm that our entire trade policy is designed to do just that; by reducing the cost of doing business as well as by enhancing the capacity of our producers to compete on a sustainable basis in the international market. There is however a continuing need to create greater public awareness about the WTO system so that some of the misconceptions in the public mind about the WTO can be corrected. The Export Promotion Bureau has been tasked by me to carry further the efforts already undertaken at the level of the Ministry of Commerce and other Ministries, and launch a major public awareness campaign.

16. From Pakistan’s perspective the best way to increase market access for our exports is further liberalization of world trade through WTO negotiations in a way which is favourable for us. However, the pace of WTO negotiations, by their very nature, are slow and countries are therefore going for interim solutions by concluding as many regional and bilateral preferential trading agreements as possible. In keeping with this trend Pakistan has also intensified its efforts in this area. In July 2003, Pakistan signed a preferential trade agreement (ECOTA) with ECO countries, and The South Asia Free Trade Agreement (SAFTA), along with six other SAARC countries, in January 2004.

17. In the bilateral sphere Pakistan signed a Preferential Trade Agreement (PTA) with China in November 2003. In order to improve our access to the US market we are making efforts to conclude in due course an FTA with the USA, and as a first step we have signed a Trade and Investment Framework Agreement (TIFA) with that country. Similar initiatives are also underway with Sri Lanka, Bangladesh, Iran, Turkey, Indonesia, Kenya, Thailand, Kazakhstan and Laos, as well as within the D-8 and OIC organizations.

18. We have a long history of economic cooperation with the EU which is also one of our largest trading partners. Pak/ EU, economic relations are conducted within the framework of a cooperation agreement and the latest third generation agreement had been awaiting operationalisation for a number of years. This year the European Parliament ratified this agreement, as a consequence of which a new phase of EU-Pakistan Economic Cooperation has begun. This cooperation includes various EU financed projects designed to build up Pakistan’s capacity for increasing its exports.

19. As we liberalize our import regime, either as a result of our international commitments, or as part of our own reform agenda, it is essential that we also have an effective mechanism in place to protect our industries against unfair competition. Such problems mostly arise either on account of dumping by foreign firms, or subsidies to their firms by foreign governments. The National Tariff Commission is a specialized organization within the Government which is authorized to take cognizance of such threats to our industry. Consequently they have initiated some investigations and also imposed anti-dumping duties in a few cases. Besides their statutory functions, they also conduct awareness activities for the benefit of our trading community. NTC has also given technical advice to our exporters facing action under trade defence laws of other countries. Given the importance of their function the institutional capacity of NTC is being strengthened continuously.

20. Today I would also like to make a special mention of the importance of intellectual property rights protection in promotion of trade and investment. The Government of Pakistan is fully alive to its international obligations to protect intellectual property rights and is constantly working to improve its capacity. Besides, we fully understand that such protection is necessary to encourage innovation, creativity and research domestically. A good protection regime will also provide the necessary "comfort" and incentive for foreign investors to invest in high tech facilities in Pakistan. Your Government is therefore resolved to improve our level of enforcement in this area in the coming days in support of our national economic objectives.

REVIEW OF LAST YEAR’S

TRADE POLICY INITIATIVES
21. Our trade policy last year contained an array of new initiatives some of which were trend setters, designed to identify opportunities. It is encouraging to note that a vote of confidence has been expressed by other Federal and Provincial agencies as they have decided to pursue some of these initiatives themselves. I am particularly appreciative of the concerted efforts of the Ministry of Industries to set up the Textile City in Karachi; and of the policy decision of the Government of Punjab to set up Garment Cites at Faisalabad and SUNDAR near Lahore.

22. In order to be able to finance the plans emerging from the 2003-2004 Trade Policy initiatives, a special long-term, fixed mark-up rate finance scheme has been launched in collaboration with the State Bank of Pakistan. Under this scheme, such units are being provided Credit on concessional terms with mark-up rates of 5 to 7.5% repayable over a period of 2 to 7-1/2 years.

23. Diversification of products and markets is an important thrust of our trade strategy, hence a 25% freight subsidy incentive was allowed to exporters to explore non-traditional products and markets. This subsidy was available for products whose annual exports were less than US$5 million or to markets where total annual Pakistani exports were under $10 million. This measure resulted in a 30% increase in exports to the eligible countries.

24. Availability of contamination free cotton is an essential pre-requisite if Pakistan is to take a quantum leap in textile exports. To this end, targeted research on issues of the ginning sector and creation of awareness among stakeholders is necessary. Accordingly, a Cotton Research Institute is being established in Multan in collaboration with Pakistan Cotton Ginners Association. Land for this facility has been identified, and feasibility prepared, on the basis of which the necessary financing has been firmed up from the Export Development Fund.

25. Export of gems and jewelry is a new sector with major potential. To support this sector, a gold assaying / hall marking facility is being established in the proposed Dazzle Park in Karachi. The necessary ground work is complete and funding has been lined up from the Export Development Fund.

26. The Fisheries Sector is also receiving priority attention, with special emphasis on shrimp and fish farming. Our partners in this effort, the Governments of Sindh and Baluchistan have already earmarked land in the coastal area and consultants are being hired to help in setting up shrimp and fish hatcheries and other state of the art facilities.

27. Agricultural exports are also a focus of our attention and we have a number of initiatives under way in this sector. Specifically, projects for an apple treatment plant in Quetta and date processing plants in Khairpur, Turbat and DI Khan are being implemented through a specially established Horticulture Development Board. Additionally, specialized agro processing Zones are also being established in Mirpur Khas, Salam, Multan and Risalpur.

28. A ground-breaking initiative was the establishment of garment cities in Karachi, Lahore and Faisalabad. Funding for this initiative of Rs1.42 billion has been arranged from the Export Development Fund. Furthermore, land for the Lahore project stands identified, and its procurement is underway. Two sites in Karachi and three in Faisalabad have also been short-listed and selection of the most appropriate sites will be made shortly, so that these facilities become operational in the very near future.

29. Relatively higher electricity rates have been making it difficult for our export enterprises to be competitive. We have been able to successfully work with WAPDA and KESC on the concept of cheaper ‘bulk’ and ‘off-peak’ rates to facilitate our industrial producers. Consequently cheaper power rates have been notified by WAPDA and KESC.

30. Some industries in Pakistan have developed in clusters like electric fans in Gujrat or cutlery in Wazirabad. For these clusters a development strategy was conceived whereby some common services would be provided to them. Such common services would include training facilities, testing services, bonded warehouses and combined marketing support, wherever feasible. This project is underway in collaboration with UNIDO and funds amounting to US$211,000 have been arranged from the Export Development Fund.

31. Marketing of our export products is of course a critical activity of the Export Promotion Bureau. There is a continuing emphasis on this activity to support our exporter community. A major initiative in this regard is the proposed holding of a mega event in the form of "EXPO PAKISTAN", scheduled from 2nd - 5th February 2005, at Karachi. On this occasion, besides show casing all our products with export potential, side events like seminars, conferences etc. will also be organized to get maximum marketing mileage. Preparations for successful mega events require massive effort, and these are well underway.

ENTERPRISE CAPACITY BUILDING AND TECHNOLOGY UPGRADATION
32. A Scheme to assist enterprises in technological upgradation and export marketing by providing them consultancy services has been launched. 50% of the cost of consultancy is being met by the EPB except in the case of leather products and carpets, where this package has been increased to 75%.

BRAND-NAME ACQUISITION / FRANCHISING
33. EPB has launched a Scheme to assist Pakistani exporters in acquiring and franchising foreign brand names so that their products may be easier to market abroad. EPB is engaging consultants to assist interested Pakistani exporters in making such acquisitions and is also picking up 50% of the cost of these consultancy services.

PROMOTING PRODUCTS MADE IN PAKISTAN
34. A Scheme to promote sale of Pakistani products abroad has been launched to help interested exporters. Under this Scheme, space in high traffic prestigious shopping malls is being arranged as per the requirement of exporters for display / sale of their products and EPB will pay 50% of the rent. In the first phase this scheme is being implemented in Dubai.

RELOCATION OF INDUSTRIES
35. Some existing industries are relocating from developed countries to countries where production costs are lower. The EPB has launched a Scheme to assist Pakistani Companies to arrange the transfer of such industrial plants to Pakistan and will share 50% of the transfer costs like freight of machinery.

Basics of Forex

Basics of Forex

What is Forex Trading?
Foreign Exchange (forex) is the simultaneous buying of one currency, and selling of another currency. Daily volume in the currency market exceeds $1.4 trillion, making it the largest and most liquid market in the world. Unlike other financial markets, the forex market has no physical location or central exchange. It is an over-the-counter market where buyers and sellers including banks, corporations, and private investors conduct business. Foreign exchange trading takes place in financial trading canters all over the world, including New York, London, and Tokyo creating one cohesive, international market. The huge number and diversity of players involved make it difficult for even governments to control the direction of the market. The unmatched liquidity and around-the-clock global activity make forex the ideal market for active traders. Traditionally the forex market was only available to larger entities trading currencies for commercial and investment purposes through banks. Now, specialized Forex trading platforms allow smaller financial institutions and retail investor’s access to a similar level of liquidity as the major foreign exchange banks, by offering a gateway to the primary (Inter bank) market.

What is Buying/Selling:
In the forex market currencies are always priced in pairs; therefore all trades result in the simultaneous buying of one currency and the selling of another. The objective of currency trading is to exchange one currency for another in the expectation that the market rate or price will change so that the currency you bought has increased its value relative to the one you sold. If you have bought a currency and the price appreciates in value, the trader must sell the currency back in order to lock in the profit. An open trade or position is one in which a trader has either bought/sold one currency pair and has not sold/bought back the equivalent amount to effectively close the position.

Quoting Conventions:
The first currency in the pair is referred to as the base currency, and the second currency is the counter or quote currency. The U.S Dollar, as the world’s dominant currency, is usually considered the base currency for quotes, and includes USD/JPY, USD/CHF, and USD/CAD. This means that quotes are expressed as a unit of $1 USD per the other currency quoted in the pair. The exceptions are the Euro, Great Britain pound, and Australian dollar. These currencies are quoted as dollars per foreign currency.

Bid and Ask:
As with all financial products, FX quotes include a "bid" and "ask". The bid is the price at which a market maker is willing to buy the base currency in exchange for the counter currency. The ask is the price at which a market maker will sell the base currency in exchange for the counter currency. The difference between the bid and the ask price is referred to as the spread.

Concept of Point or Pip:
In the wholesale market, currencies are quoted using five significant numbers, with the last placeholder called a point or a pip. In forex, like any traded instrument, there is an immediate cost in establishing a position. For example, USD/JPY may bid at 131.40 and ask at 131.45, this five-pip spread defines the trader’s cost, which can be recovered with a favourable currency move in the market.

Margin:
The margin requirement allows traders to hold a position much larger than the account value.The trading platform performs an automatic pre-deal check for margin availability, and will only execute the deal if the client has sufficient margin funds in his or her account. The Forex Broker's system also calculates the funds needed for current positions and displays this information to clients in real time. In the event that funds in the account fall below margin requirements, the For Ex Brokers will close all open positions. This prevents clients' accounts from falling below the available equity even in a highly volatile, fast moving market.

Rollover:
In the spot forex market trades must be settled in two business days. For example, if a trader sells 100,000 euros on Tuesday, the trader must deliver 100,000 euros on Thursday, unless the position is rolled over. As a service to traders, Forex Brokers automatically roll over all open positions i.e. swaps the trade forward to the next settlement date (two business days) at 5:00 PM New York time. The swap rates are determined at the Inter bank level and are tradable instruments. In any spot rollover transaction there is a difference in interest rates between the two currencies that will be reflected in the overnight loan. If the trader is long the currency with the higher interest rate in the pair, the trader should gain on the spot rollover through the premium relationship of that currency relative to the short currency. The amount of the gain is determined by the interest rate differential between the two currencies, and fluctuates day to day with the movement of prices. For instance, on any given day, the rollover can be $2 per lot for USD/JPY and $15 for GBP/JPY. Rollover fees are usually shown in dollars, and are posted in Forex Brokerage Accounts every day, usually by 3:00 pm New York time. For day traders that never hold a position overnight, rollover will not affect trading.

What Every Currency Trader Should Know:
The forex market is one of the most popular markets for speculation due to its enormous size, liquidity, and tendency for currencies to move in strong trends. An enticing aspect of trading currencies is the high degree of leverage available. The Forex Brokers usually allow positions to be leveraged up to 100:1. Without proper risk management, this high degree of leverage can lead to enormous swings between profit and loss. Knowing that even seasoned traders suffer losses, speculation in the forex market should only be conducted with risk capital funds that if lost will not significantly affect one's personal financial well being.

How can I participate in the Spot Currency market as a Trader?
From 1971 until recent years the virtual owners of this market were the banks, multinational corporations and large brokerage firms. If an individual wanted to invest in this market, he could invest with a bank with a one million dollar cash deposit backed by the requirement of a 5-10 million dollar net worth. A slightly better option was provided by the brokerage firms, which asked a lower minimum deposit on average of a quarter million dollars.

But now the forex market has been opened up to Individual investors. Unlike the huge sums of money previously required by the banks and brokerage firms, comparatively far lower margin requirements are finally available that now allows virtually any individual to trade along with the professionals and institutions. In addition, individual investors have the opportunity to take advantage of the growing boom in computer and communication technologies that has made this market accessible in ways previously exclusive only to large players. Foreign Exchange Trading Provides an Alternative Investment Vehicle to Equity or Debt Instruments!

Currency trading gives you, the investor, and the opportunity to not be affected by a bear market. Currency is very different from a typical investment portfolio where one might purchase stocks, bonds or real estate. In these instances you are looking for opportunities to buy at a period low and hold, hoping that the price will increase and then sell at a higher price. In effect the typical investor will simply wait for results and hope they are favorable. In currency trading you have more opportunity to control your destiny. You will control your own money and realize with your trading you are not dependent on a market direction.

For example, in your investment decisions in Forex you are able to deal with the dollar on both sides of the market. Consider a Sterling/US currency scenario. When you buy Sterling, it means that you sell USD. The same holds true when you do the opposite. Selling Sterling simply means that you bought US dollars. In other words you can start by selling a currency without first buying it. This ability to invest in both sides of the currencies gives an investor the opportunity to use the two-way market approach as an exact lucrative alternative to the scenario described above with "wait and see" investments.

Currency trading gives you instant liquidity and a flexible investment strategy. Trading currency online expedites the process and increases your opportunity for successful trades. As your knowledge of the market increases, so will your sophistication of trading and opportunity for incredible profits. A Bear Market will no longer be a fact to consider.

How fair is the Forex market?
The Forex market is so large and is composed of so many participants that no one player, not even a large government, can completely control the long-term direction of the market. So, many experts have called Forex the “most level playing field” on earth.

How often does a person have to trade?
The beauty of self-trading Forex is that a person can trade as occasional or often as they want. They can learn to trade longer-term strategies that may require checking the market as little as once or twice a week. Or, they can learn to trade shorter-term methods that may require watching the market a few hours a day.

Do you need a lot of money to trade currencies in the forex market?
No. The minimum deposit required is $5,000. Customers are allowed to execute margin trades at up to 50:1 leverage. This means that investors can execute trades up to $100,000 with an initial margin requirement of $2000. However, it is important to remember that while this type of leverage allows investors to maximize their profit potential, the potential for loss is equally great. A more pragmatic margin trade for someone new to the Forex markets would be 5:1 or even 10:1, but ultimately depends on the investor's appetite for risk.

What is Margin?
Margin is essentially collateral for a position. If the market moves against a customer's position, additional funds will be requested through a "margin call." If there are insufficient available funds, immediately the customer's open positions will be closed out.

What does it mean have a “long” or “short” position?
A long position is one in which a trader buys a currency at one price and aims to sell it later at a higher price. In this scenario, the investor benefits from a rising market. A short position is one in which the trader sells a currency in anticipation that it will depreciate. In this scenario, the investor benefits from a declining market. However, it is important to remember that every Forex position requires an investor to go long in one currency and short the other.

How do I manage risk when I trade currencies?
The most common risk management tools in Forex trading are the limit order and the stop loss order. A limit order places restriction on the maximum price to be paid or the minimum price to be received. A stop loss order ensures a particular position is automatically liquidated at a predetermined price in order to limit potential losses should the market move against an investor's position. The liquidity of the Forex market ensures that limit order and stop loss orders can be easily executed.

What kind of trading strategy should I use?
Currency traders make decisions using both technical factors and economic fundamentals. Technical traders use charts, trend lines, support and resistance levels, and numerous patterns and mathematical analyses to identify trading opportunities, whereas fundamentalists predict price movements by interpreting a wide variety of economic information, including news, government-issued indicators and reports, and even rumor. The most dramatic price movements however, occur when unexpected events happen. The event can range from a Central Bank raising domestic interest rates to the outcome of a political election or even an act of war. Nonetheless, more often it is the expectation of an event that drives the market rather than the event itself.

How frequent do people trade currencies?
Market conditions dictate trading activity on any given day. As a reference, the average small to medium trader might trade as often as 10 times a day.

How long are positions maintained?

As a general rule, a position is kept open until one of the following occurs:
1) Realization of sufficient profits from a position;
2) The specified stop-loss is triggered;
3) Another position that has a better potential appears and you need these funds.


This article has been taken from reliable sources

US Dollar Report; International

US Dollar Report; International
On Saturday, 6th June 2009



Dollar rises most against Euro since April on U.S. jobs data

(Bloomberg) -- The dollar advanced the most against the euro since April and rose to a four-week high versus the yen after a U.S. government report showed employers cut fewer jobs last month than economists forecast.

The greenback climbed against almost all of the other major currencies as a slower deterioration of the labor market supported bets dollar-denominated assets will gain as the U.S. leads the global economy out of a recession. The yen fell versus the Australian and New Zealand dollars on speculation investors will increase purchases of higher-yielding assets.

“We may be moving to a situation where stronger economic numbers are actually good for the dollar,” said Vassili Serebriakov, a currency strategist at Wells Fargo & Co. in New York. “It may be just a hint that the pessimism on the dollar has been overdone and we’re moving to a dollar that is not necessarily stronger but perhaps more consistent with the recent improvement in the U.S. economic data.”

The dollar appreciated as much as 1.8 percent versus the euro, the biggest intraday gain since April 27, before trading at $1.3966 at 4:01 p.m. in New York, compared with $1.4183 yesterday. The dollar rose 2.4 percent to 98.85 yen, from 96.58, after touching 98.89, the highest level since May 8. The euro climbed 0.8 percent to 138.01 yen from 136.97.

The trade-weighted Dollar Index increased today as traders added to bets demand for assets denominated in the greenback will rise in an economic recovery. The measure used by the ICE to track the dollar’s value against the euro, yen, pound, Canadian dollar, Swiss franc and Swedish krona advanced 1.9 percent this week after last month’s 6.4 percent decline.

‘Potential Shift’
“If the U.S. is potentially going to lead a recovery, why is it going to be penalized?” said Alan Ruskin, head of international currency strategy in North America at RBS Securities Inc. in Stamford, Connecticut. “There’s a potential shift in correlations that relates to people reconsidering whether good U.S. news is bad for the dollar.”

The dollar fell earlier this week to its lowest level in 2009 against the euro on concern the quadrupling of the U.S. government’s budget deficit this year would sap demand for Treasuries among overseas investors and central banks.

The Australian and New Zealand dollars rose against the yen for a fourth time in five days on bets the U.S. payrolls report will spur carry trades, in which investors borrow funds in a country with low interest rates and buy assets where returns are higher. The target lending rate of 0.1 percent in Japan compares with 3 percent in Australia and 2.5 percent in New Zealand.

‘A Green Light’
“It’s a green light for some more risk-seeking trades out there in the currency market,” said Samarjit Shankar, a director of global strategy in Boston at Bank of New York Mellon Corp., which administers more than $20 trillion in assets. “There’s more momentum to the view that the worst of the cycle might be behind us.”

U.S. job cuts slowed to 345,000 in May, fewer than the revised decrease of 504,000 in the previous month, the Labor Department reported today in Washington. The median forecast of 76 economists surveyed by Bloomberg News was for a 520,000 reduction. The unemployment rate rose to 9.4 percent.

Japan’s currency fell 0.7 percent to 61.66 against the New Zealand dollar and 0.9 percent to 78.17 versus the Aussie.

Canada’s dollar, known as the loonie, slipped 2 percent to C$1.1190 versus the greenback as a Canadian government report showed the economy lost jobs for a sixth time in seven months, pushing unemployment up to 8.4 percent. The loonie fell 2.5 percent this week against its U.S. counterpart.

Dollar Versus Yen
The dollar also gained against the yen on speculation the Federal Reserve will raise interest rates later this year, reducing the cost advantage of borrowing in the U.S. to fund purchases elsewhere.

Traders added to bets the U.S. central bank will increase its target rate for overnight loans between banks, now in a range of zero to 0.25 percent, by its November policy meeting, according to futures traded on the Chicago Board of Trade. The contracts show a 67 percent chance of a rate increase at that meeting, compared with 24 percent odds a week ago.

The euro’s decline against the dollar may extend for the next two to four weeks provided the 16-nation currency breaks its five-week trend support line by falling below $1.3885, Andrew Chaveriat, a technical strategist at BNP Paribas SA in New York, wrote in a note.

“Euro-dollar is currently suffering the biggest short-term downswing since the April rally began,” said Chaveriat, citing the end of a rising trend that began May 18 and the euro’s decline below support at $1.3995, the 24 percent retracement of its gains since April.

Support Levels
Support is a level where orders to buy or sell a currency may be clustered, and trends are patterns traders identify on charts that describe a currency’s path higher or lower.

The pound traded near its lowest level this month against the dollar as Prime Minister Gordon Brown rearranged his cabinet amid calls for his resignation.

Sterling slid 1.2 percent to $1.5977 after touching $1.5941, the weakest since May 29. It briefly erased its decline as the U.S. jobs report spurred speculation that demand for Britain’s assets will rise.


Source: Bloomberg

International Conversion Rates

International Conversion Rates
On Saturday, 13th Jun 2009




USD EUR JPY GBP CHF CAD AUD HKD
HKD 7.7503 10.863 0.0787 12.7442 7.1822 6.9259 6.296
AUD 1.231 1.7254 0.0125 2.0242 1.1407 1.1 0.1588
CAD 1.119 1.5685 0.0114 1.8401 1.037 0.9091 0.1444
CHF 1.0791 1.5125 0.011 1.7744 0.9643 0.8766 0.1392
GBP 0.6081 0.8524 0.0062 0.5636 0.5435 0.494 0.0785
JPY 98.435 137.9685 161.8616 91.2195 87.9646 79.9647 12.7008
EUR 0.7135 0.0072 1.1732 0.6612 0.6376 0.5796 0.0921
USD 1.4016 0.0102 1.6444 0.9267 0.8936 0.8124 0.129

From the International Desks

From the International Desks
On Friday, 12th June 2009





Yen falls, set for weekly loss, on stock gains, recovery signs


(Bloomberg) -- The yen declined against higher- yielding currencies, extending its weekly loss, as Asian stocks rose and China said industrial output rebounded in May, spurring demand for riskier assets.

The Swedish krona, New Zealand dollar and British pound, rose the most against the yen this week of the 16 most-traded currencies before reports today that economists said will show the decline in European industrial output slowed and U.S. consumer confidence improved. The dollar rose against 13 of the 16 most-traded currencies today after the Wall Street Journal reported the Federal Reserve will resist pressure to increase bond purchases, avoiding adding to the supply of U.S. currency.

“As expectations that the U.S. economy is bottoming out of the recession are growing, risk appetite is recovering,” said Masahide Tanaka, senior strategist in Tokyo at Mizuho Trust & Banking Co., a unit of Japan’s second-largest bank. “Risk money continues to fly into stocks, commodities and higher-yielding currencies, shifting away” from the dollar and the yen, he said.

The yen declined to 138.13 per euro as of 7:20 a.m. in London, from 137.74 yesterday in New York, set for a 0.2 percent decline this week. Japan’s currency fell to 98.01 per dollar from 97.63, paring its gain this week to 0.6 percent. The dollar traded at $1.4094 per euro from $1.4108, set for a 0.9 percent decline this week.

Against the yen, the pound has strengthened 3.1 percent this week, Sweden’s krona has gained 2.2 percent, Australia’s currency has added 2.2 percent and New Zealand’s dollar has appreciated 2.1 percent.

Higher Yields
Benchmark interest rates are 3 percent in Australia, 2.5 percent in New Zealand and 1 percent in the euro region, compared with 0.1 percent in Japan and as low as zero in the U.S., encouraging investors to borrow in nations with low interest rates and buy high-yielding assets elsewhere.

The dollar gained versus Australia’s currency today after the WSJ reported the Fed will probably maintain its current level of purchases of Treasuries and mortgage-backed securities when it meets in late June, resisting pressure to buy more.

The U.S. central bank may make other adjustments as it is increasingly divided over whether it should do more to quicken an economic recovery and repair the credit system or start reducing levels of credit easing to prevent inflation, the report said, without saying where it got the information.

“Investors are getting wary about the exit strategy for unconventional monetary policy by central banks and there is a guessing game about which central banks will do so first,” said Kengo Suzuki, manager of the foreign bond department in Tokyo at Mizuho Securities Co.

Strong Dollar
The U.S. currency was also boosted today on speculation Treasury Secretary Timothy Geithner will reiterate the government’s strong dollar policy at the Group of Eight meeting starting today in Italy.

“Investors cannot rule out the possibility of unexpectedly seeing some market-moving comments at the G-8 meeting, such as a reiteration of a strong dollar policy by Geithner,” Suzuki said.

The Nikkei 225 Stock Average rose 1.6 percent today to the highest level in eight months, extending this week’s gains to 3.8 percent. The MSCI Asia Pacific Index advanced 2.2 percent this week.

“With people becoming more confident about the outlook of the global economy, as evidenced by a firm stock market, money seems to be trickle down into countries which export commodity products, including Canada and Australia,” said Yoshifumi Suzuki, a Tokyo-based currency dealer at Hachijuni Bank Ltd. “People may want to bring their currencies back to levels seen before Lehman Brothers collapsed.”

Canadian Dollar
Canada’s dollar and Norway’s krone headed for weekly gains after crude oil rose above $73 a barrel yesterday for the first time in seven months.

The so-called loonie rose 1 percent this week to C$1.1077 versus the U.S. currency and Norway’s krone advanced 2.1 percent to 6.2822 per dollar. Crude oil, the two nations’ largest export earner, climbed to $73.23 a barrel yesterday.

China’s industrial production increased 8.9 percent from a year earlier, after gaining 7.3 percent in April, the government said today. Retail sales grew 15.2 percent, after climbing 14.8 percent in April, the statistics bureau said.

The International Monetary Fund raised its forecast for global growth in 2010 to 2.4 percent from 1.9 percent, a person familiar with the matter said yesterday. U.S. government reports yesterday showed retail sales increased 0.5 percent last month and initial jobless claims dropped by 24,000 last week to the lowest level since January.

Industrial Production
European industrial production fell 19.8 percent in April from a year earlier, after a record drop of 20.2 percent the previous month, according to a Bloomberg News survey of economists before the European Union’s statistics office releases the data today.

The Reuters/University of Michigan preliminary sentiment gauge for June climbed to 69.5, the highest since September, from 68.7 in May, according to a separate Bloomberg survey before today’s report.

“This issue is negative for the dollar because it weakens demand for the greenback,” said Shoichi Handa, a senior currency dealer in Tokyo at SBI Liquidity Markets Co., a unit of financier SBI Holdings Inc. “How far the reshuffling of foreign-exchange reserves by central banks will develop will be the key to assessing the impact on the dollar.”

The dollar was also supported after Japan’s Finance Minister Kaoru Yosano said his government is confident about the outlook for U.S. Treasuries, signaling the second-biggest foreign holder of the securities will keep purchasing them.

“We have complete trust in the fact that the U.S. views its strong-dollar policy as fundamental,” Yosano said in an interview in Tokyo on June 10 before attending the G-8 meeting of finance ministers in Italy. “So our trust in U.S. Treasuries is absolutely unshakable.”

Pakistan's Major Financials

Pakistan's Major Financials
On Friday, 31st Oct 2008


IMF asks Pakistan to make oil payments through market flows


KARACHI (October 31 2008): The International Monetary Fund estimates that Pakistan's growth will slow down to 3.5-3 percent in the current financial year after Pakistan signs for Stand-By Arrangement (SBA) facility with the Fund. In fact, the Fund is not concerned at the annual GDP growth even if it falls below three percent because the Fund fully appreciates the facts that historically Pakistan has shown that once it is able to achieve macroeconomic stability the growth of above six percent is also achieved for a long period of time.

-- The growth path would be 'U' shaped (low growth) if the country does not increase the policy rate. The Fund, therefore, would like the growth path to be in 'V' shape if Pakistan adheres to its loan conditionalities. If Pakistan does not increase the policy rate by 3.5 percent to 16.5 percent (which is close to a 17 percent rise in CPI), the Fund fears that Pakistan's growth path would be 'U' shaped ie low growth for a longer period.

EXCHANGE RATE: The Fund team, which negotiated with Pakistani authorities in Dubai, for the last seven days, is satisfied with the present exchange rate which is market driven. However, the Fund wants the State Bank of Pakistan to let the market flows meet the oil import payments instead of utilisation of SBP reserves for this purpose.

An L/C opening bank needs to accumulate the dollars from the inflows as it knows when the L/C will be encashed. At present, SBP meets the bank needs as the lumpy payment increases the volatility in exchange rate movement. Pakistan would need to improve its forex reserves by $700 million from the present level of $7 billion at the end of one year of the programme. This estimation is based on the various Sukuk bonds and other payment due by until November 2009.

Pakistan is committed to improve its tax-to-GDP ratio to 15 percent in medium term, however, it would need to improve this ratio by at 0.6 percent to FY09 in case it awaits the Fund seal of approval. Since Pakistan has already met over 80 percent of the Fund's normal conditionalities on its own ie reduction in subsidy on oil and utilities and a market driven exchange rate - there is very little left for further discipline.

The insistence of 3.5 percent in SBP discount rate is the only real pain that the nation would need to undergo. However, the Fund would allow this policy rate to come down once it is clear that the core inflation has reversed.

It takes six to 12 months for monetary tightening measures to work through the system in Pakistan. Helping the Mutual Fund industry is likely to be acceptable to the IMF. But any bail-out or guarantees for the stock market are favoured by the Fund, say informed sources.




Source: www.brecorder.com

What is Forex ?

What is Forex ?


Forex (FOReign EXchange market) is an inter-bank market that took shape in 1971 when global trade shifted from fixed exchange rates to floating ones. This is a set of transactions among forex market agents involving exchange of specified sums of money in a currency unit of any given nation for currency of another nation at an agreed rate as of any specified date. During exchange, the exchange rate of one currency to another currency is determined simply: by supply and demand – exchange to which both parties agree...











Currency Trading Rules


1. PLAN YOUR TRADE AND TRADE YOUR PLAN. You must have a trading plan to succeed. A trading plan should consist of a position, why you enter, stop loss point, profit taking level, plus a sound money management strategy. A good plan will remove all the emotions from your trades.
2. THE TREND IS YOUR FRIEND. Do not buck the trend. When the market is bullish, go long. On the reverse, if the market is bearish, you short. Never go against the trend ...




Choosing a Forex Broker


Choosing the best forex broker is important. The best broker provide you the services you're looking for and you are not charged for unnecessary services that you don't need. Here is the list where you'll find guides on choosing the best forex brokerage firm for yourself...


Forex Brokerage Firms

Forex Forecasts - FX Forecasting

Forex Forecasts - FX Forecasting
A few points to understand when planning your strategy


If you are interested in Forex forecasts, it is important to understand that Forex trends are
easy to see in retrospect. Foreign currency markets are predictable, at least in a broad sense – however, they still bow to a certain set of variables.



Once a trend is in place in the Forex market, it tends to stay around indefinitely. It can last for months, even years. These types of Forex forecasts open a window of opportunity for longer-term investing

Watch the trends, but remember that Forex is unique.
The Forex marketplace is highly liquid, with rapid changes that take place around the clock. You can make a profit Forex trading by adhering to a trading strategy that you have created for yourself. Enter your stops only when the odds are stacked in your favor.

Keep in mind, when making or analyzing Forex forecasts:
Forex is a truly seamless 24-hour market. Trades are conducted while you’re sleeping, eating, and working.
Forex is a true zero-sum game. This means that a gain is often offset by an equal loss.
Forex has no secondary measures, unlike other marketplaces. This means it has no upside/downside volume figures or P/E ratios.
Major Forex players end their days mostly flat – this is because they are often handling billions of dollars - during their time zone.
Central banks openly declare their intentions and impact trends in the Forex marketplace.
The truth is although there are overall trends to forecast in the marketplace, Forex is a highly volatile market. Like the stock market, Forex markets are ruled predominantly by emotions, perceptions and the reactions to these. There are many cultural differences to be aware of when working with a large span of currencies. A spike in your candlestick chart may be the reaction to a new story in another country, and the ripple may settle by the time the business day has closed in that geographical region.



Take the time to gain an understanding of the market, and analyze reactions. Forex forecasts can be the key to meeting longer-term financial targets, but it’s up to you to choose the best strategy for your needs. Make a plan, set a goal, and monitor your progress in the upcoming weeks and months.

Forex System - FX Trading Software Systems

Forex System - FX Trading Software Systems
Choose and Use Your Forex Software Wisely


There are plenty of Forex systems available on the web. Choosing the right Forex software can sometimes be perplexing, even for the experienced trader. Most brokers offer a Forex software package as a premium for users of their trading accounts. Just because it’s free, however, doesn’t mean it’s the right choice. It is important to evaluate different software platforms and get experience in using it correctly.

Trying out your Forex system
The software your broker gives you is most likely a very basic system. You may be able to add features to your program for a specific price. Initially, get comfortable with the software your broker provides. Once you’ve gotten familiar with it, download and try some different packages using a demo account. This will help you get an idea of what is available to Forex traders.

Desktop or Web-based?
Forex trading systems are available either online, as an application service, or via your desktop. No matter which platform you select, it is important to have a reliable and secure internet connection. A cable modem or broadband ISP is an ideal connection for trading.



Web based Forex software is the most secure type of software. Information stored in a desktop application can be penetrated by malicious software, viruses, and other unwanted intruders.

If you plan on desktop trading, it is important to have a firewall in place with constantly updated virus protection. You don’t want hackers somehow getting access to your account! You should also back up your hard drive regularly so you don’t accidentally lose information if your computer crashes.

Keeping your trading software secure
If you plan on using desktop applications for your trading, you’ll probably want to have a dedicated computer (not on a network) to serve your trading needs. A few things to help you keep your account information secure:



• Password protect any software or documents relating to your Forex trading system.


• Make regular backups of your trading information – past trades, current trades, and items that you are watching.


• Add protective software. It’s not enough to just use an anti-virus software program anymore. Don’t use the free versions – you often get what you pay for. You should have a firewall program (not just the Windows version) as well as a professional spy ware scanner. Make sure you schedule your scans to happen once a day – preferably, when you are NOT running your Forex software.


• Update your trading software, operating system, and other programs regularly.



Choosing the right Forex system solution is not just about the type of Forex software. It is also important to examine capabilities and learn more about the charts and other technical indicators available. Luckily, there are plenty of resources to help you make the right choice. Your software is directly related to your broker, so make sure that you read up on how to find the right broker for your needs as well. Welcome to the world of Forex trading!

Forex Charts

Forex Charts
Understanding 3 Basic Forex charts

How to use them to see trends in Forex rates
You can view Forex charts to navigate trends in a variety of formats. Usually, your analysis tools will by supplied by your broker. Come traders also purchase software solutions for technical analysis online.



There are many types of charts for the Forex trader to use, but this article is going to give you insight into the basics. If you are familiar with the stock market, you may be familiar with some of these charts and how they are used.



When reading this article, you may find it helpful to use your charting software to generate some charts so you can learn as you go along.

The Forex Candlestick Chart
Each “candlestick” is composed of a vertical rectangle and/or vertical lines. The lines are actually more like blocks that look like a candlestick. This is the most common chart used to see trends in Forex rates. When looking at a candlestick chart, make note of the following:



• The rectangle – is it black or white? The rectangle color indicates the open and close of a day or trading periods. It may be colored black or white. It depends on the relationship of the open and close to each other. A white body indicates that the asset price, at the end of the day, was higher than it was when it opened. A black body signifies a closing price lower than the price at the opening of the day. The lines, often called shadows, show the high and low of the day.



• Candlestick lengths – how far do they range? The lengths of each candlestick's rectangle and shadows show the range of trading in a day. This can give a trader a good view of each day relative to previous and following ones.



• The patterns – what do they mean? Patterns of candlesticks, sometimes called constellations, maybe interpreted as an indication of human trading activity.


continue to forex charts, part ii

Automated Forex Trading

Automated Forex Trading
What to Look for in Your FX Provider


An automated Forex trading system can help a new trader practice discipline. The Forex market trades 24 hours a day and provides excellent leverage for every investor. Unfortunately, it can be challenging for the average investor to catch the trades they want if they need to get sleep in their time zone. Forex markets can move outside of their usual active timeframes. Without an automated trading solution, many investors miss valuable trades.


This is where auto trading comes in. Usually, the solution will be provided by your broker. You’ll have to customize your software to follow the methodology you use in your traders. With the right automated Forex trading software, you don’t have to focus on every detail – you just have to set it up in your application. Your software should place trades, monitor the markets, catch directional trades, and place the limits and stops once a trade is live. An automated system frees you up from the minor details and lets you focus on other areas of your trading strategy.

What to look for in your automated Forex trading solution:
• Does the automation allow you to trade multiple strategies?
• Is it easy to install and set up?
• Does the provider have online and live telephone support?
• Can it utilize multiple strategies in different time frames?
• Does it automatically place your orders early in the exchange queue?
• Can it trade multiple accounts?


An automated trading solution can help eliminate stress and avoid stalled decision making by processing all complex factors and differentials with quick and logical precision. Before selecting a provider, it is still important to test the system out on your own. Ask your broker for a demo of the software and take time to tweak the settings to make sure it makes decisions according to your strategy. The right features and options in your automated Forex trading software can allow you to customize your trading experience – even while you’re away from the computer.


March 17th 2006 READ MORE