Monday, August 25, 2008

Hey, Somebody Thinks Our Economy is Good

Hmmmmmm.....What's with this? Good news about the US economy? The Dems would have us believe otherwise. Bloomberg reports some encouraging news about the dollar.

Yen, Swiss Franc Advance on Reduced Demand for Higher Yields

By Ye Xie and Anchalee Worrachate

Aug. 25 (Bloomberg) -- The yen and Swiss franc rose against most of the other major currencies on bets credit market losses will widen, prompting investors to sell holdings of higher- yielding assets and pay back loans in Japan and Switzerland.

The dollar briefly pared its loss against the yen as an industry report showed U.S. home resales rose last month more than economists forecast. South Korea's won fell to the lowest level against the dollar in almost four years as overseas investors stepped up sales of the nation's shares.

``Credit markets may be the prominent concern this week,'' said Vassili Serebriakov, a currency strategist at Wells Fargo & Co. in New York. ``That points to outperformance of the yen and the Swiss franc.''

The yen gained 0.3 percent to 109.70 per dollar at 10:06 a.m. in New York, from 110.07 on Aug. 22. The euro declined 0.4 percent to 162.26 yen, from 162.83. The dollar traded at $1.4792 per euro, compared with $1.4793. The Swiss franc rose 0.3 percent to 1.6197 per euro and 0.4 percent to 1.0945 per dollar.

Japan's currency climbed 0.5 percent to 77.63 per New Zealand dollar and the franc increased 0.6 percent to 7.03 South African rand on reduced demand for carry trades, in which investors get funds in a country with low borrowing costs and buy assets where returns are higher. Japan's target lending rate of 0.5 percent and Switzerland's 2.75 percent benchmark compare with 8 percent in New Zealand and 12 percent in South Africa.

Bank of America Corp. and JPMorgan Chase & Co. dropped more than 1 percent after Columbian Bank and Trust Co. of Topeka, Kansas, was shuttered by the state bank commissioner's office and the Federal Deposit Insurance Corp. on Aug. 22. U.S. Treasuries rose, snapping a two-day decline.

South Korea's Won

South Korea's won dropped as much as 1.6 percent to 1,079.85, the weakest level since November 2004. Global fund managers have sold 1.33 trillion won ($1.23 billion) more local shares than they bought since Aug. 18, stock exchange data show.

The Pakistani rupee fell 0.3 percent to 76.63 versus the dollar as Nawaz Sharif, head of Pakistan's second-largest party, quit the six-month-old ruling alliance, setting up a clash with Pakistan Peoples Party leader Asif Ali Zardari over who will replace Pervez Musharraf as president. The rupee is the world's fourth-worst performer, behind the Zimbabwean dollar, Turkmenistan manat and Icelandic krona.

Resales of homes in the U.S. rose to a 5 million annual rate in July, the National Association of Realtors reported. The median forecast of 75 economists surveyed by Bloomberg News was for an increase to 4.91 million.

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