Forex Fc

31 Dalil Mengapa SOROS dan Wachaa Layak Menjadi IRCOP.(Selepas 10 tahun )

2008-03-19T20:46:00.000-07:00

Selepas lebih 10 tahun , Nick SOROS dan Waachaa masih lagi aktif di dunia MIRC.
Pada awal tahun 1998 server webnet menjadi popular apabila para penguna MIRC yang dahulunya lebih gemar berada di server Dalnet beralih server.Di era ini bermulalah perebutan Nick Name, Channel dan gelaran.
Dua nama atau nick name yang menjadi popular dikalangan “senior MIRC Webent” sekarang ialah SOROS dan Waachaa.Gandingan serasi dan mantap mereka berdua telah banyak memberi impak kepada irc webnet.Pro dan Kontranya memang ketara dan menjadi memori.Kecemerlangan mereka dalam dunia irc ini boleh dikelaskan sebagai
Modal insan yang patut menjadi panduan kepada user-user baru.
Kerakusan user lama dalam mengejar status pemain bergelar AOP, SOP dan MGR tidak banyak berubah hingga sekarang.Namun bagi dua nama diatas pangkat atau level acess bukan segalanya dalam dunia irc.Semangat yang kental dan tidak putus idea menjadikan Mereka sukar untuk ditewaskan dan layak dimartabatkan sebagai IRCOP.
Di sini saya mempunyai 31 sebab mengapa mereka berdua ini layak menjadi IRCOP.

1.Soros dan waachaaa antara user terawal mendaftarkan nick di server webnet.
2. Soros dan waachaaa tidak segan / malu menggunakan internat dimana-mana saja demi untuk Online mirc.
3. Soros dan waachaaa tidak suka bermain script untuk tujuan perang.
4. Soros dan waachaaa memanipulasi sepenuhnya mirc
5. Soros dan waachaaa mesra didunia irc dan lebih mesra bila rekreasi.
6. Soros dan waachaaa memiliki rahsia ayat power.
7. Soros dan waachaaa kekuatan mereka sebenarnya bermula dengan ASL.
8. Soros dan waachaaa sentiasa membawa disket back up.
9. Soros dan waachaaa dikenali oleh semua pemilik cyber café.
10. Soros dan waachaaa dikenali oleh kebanyakan IRCOP
11. Soros dan waachaaa Nick mereka pernah di froze oleh IRCOP
12. Soros dan waachaaa pernah memperdayakan IRCOP.
13. Soros dan waachaaa pernah Take Over nick user-user lain.
14. Soros dan waachaaa pernah take over channel milik user lain.
15. Soros dan waachaaa pernah take over nick IRCOP.
16. Soros dan waachaaa pernah menyebabkan IP addres CC di kill oleh IRCOP.
17. Soros dan waachaaa dituduh IRCOP sebagai clone .
18. Soros dan waachaaa merokok untuk menenangkan fikiran.
19. Soros dan waachaaa boleh menjadi peserta jalan kaki
20. Soros dan waachaaa menjadi kegilaan remaja lelaki dan perempuan
21. Soros dan waachaaa mengilakan gadis remaja
22. Soros dan waachaaa dimana-mana saja pasti ada saja.
23. Soros dan waachaaa berkongsi ilmu, petua dan gaya
24. Soros dan waachaaa boleh berkomunikasi dalam bahasa English di irc atau di dalam bas.
25. Soros dan waachaaa boleh menjadi soros dan menjadi waachaa dan menjadi waachaa dan soros.
26. Soros dan waachaaa boleh tipu dunia tapi jangan Soros dan waachaaa.
27. Soros dan waachaaa tidak percaya ilmu pengasih.
28. Soros dan waachaaa tidak suka menyamar nick lain.
29. Soros dan waachaaa sentiasa single di irc.
30. Soros dan waachaaa fleksible dimana saja termasuk atas bangunan.
31. Soros dan waachaaa hobi memancing dan memancing.

* nick waachaaa mirc webnet sekarang bukan waachaa yang dahulu.Tapi orang baru yang ambil kesempatan glamour atas nama waachaa.

EUR/USD

2008-03-01T07:14:00.000-08:00

3:55am EUR German Manufacturing PMI

Januari PMI : 54.4 Ramalan : 54.0

4:00am EUR Manufacturing PMI (r)

Januari PMI : 52.3 Ramalan : 52.3

Sekiranya PMI German masih 54.00 atau kurang = Euro down
Sekiranya PMI EUR manufacturing masih 52.3 atau kurang = Euro down

Harap-Harap Betul la ni,.

Saturday, 1st March 2008

German January manufacturing PMI 54.4 points; consensus 53.1 – sources

FRANKFURT (Thomson Financial) - The German purchasing managers' index for manufacturing rose to 54.4 points in January from 53.6 in December and came in higher than expected, market sources said.

Economists polled by Thomson Financial had forecast the index to decline to 53.1 points.
14:32 02/29 (CEP News) Montreal - The final euro zone PMI manufacturing data for February, to be announced on Monday, is expected to come in at 52.3, unchanged from the preliminary estimate released in January. The final manufacturing PMI figure for January was 52.8.
Fortis Bank Nederland senior economist Nick Kounis is among those calling for the PMI indicator to remain unchanged from the preliminary release at 52.3

“If there is nothing special expected between the first and second estimates, there should be no revision to come,” he highlighted.
February’s PMI manufacturing indicator for Germany will also be released on Monday. The market is projecting the indicator to come in at 54.0, down slightly from 54.4 recorded in the previous month.

26 Februari 2008 .Hari ni banyak news ni

2008-02-25T15:41:00.000-08:00

Pandai-Pandai la kamu, becare full aa, kalau kena makan-makan la pips .

News 25 Hb Februari 2008

2008-02-23T23:54:00.000-08:00

Ok geng, Ikut News Hari Isnin, Ada satu news yang medium impak dan satu high impak .Melibatkan Pair USD.
Mungkin berita baik, atau buruk.Masalahnya kita lambat dapat infomasi baik buruk news tersebut.Lewat seminitpun kita akan ketinggala sampai 50- 60 pip.
Oleh itu ,saya cadangakan kita stanby saja la Jam 9.50pagi (time us) atau jam 10.50 malam waktu kita Ini news Medium Impak .Dan selepas itu Jam 10.00 am (us ) atau 11.00pm waktu kita.Ini news High Impak.
Apapun ceritanya sila buat Buy dan sell di Point yang sama dan Letak Stop Lose.jangan letak stop lose terlalu besar.cukup la dalam 15pip atau 20pip.
Okey? Harap2 berjaya la.. heheh. Google adsene ni , peluki oo kan ekekke.
KIta buat blog cantik2 dia disable pula adsense kita .Puii Taik Hidung Masin.

-ForexFc-

Weekly Review and Outlook: Dollar Weakened on Recession Fear

2008-02-16T19:56:00.000-08:00

Market Overview | Written by ActionForex.com | Feb 16 08 23:00 GMT |
Weekly Review and Outlook
Dollar Weakened on Recession Fear
Top 5 Current Last Change
(Pips) Change
(%)
AUDCAD 0.9147 0.8947 +200 +2.19%
EURCAD 1.4780 1.4494 +286 +1.94%
AUDJPY 97.89 96.11 +178 +1.82%
GBPCAD 1.9748 1.9440 +308 +1.56%
EURJPY 158.18 155.74 +244 +1.54%
Dollar
EURUSD 1.4682 1.4509 +173 +1.18%
USDJPY 107.73 107.33 +40 +0.37%
GBPUSD 1.9613 1.9458 +155 +0.79%
USDCHF 1.0929 1.1032 -103 -0.94%
USDCAD 1.0068 0.9989 +79 +0.78%
Euro
EURUSD 1.4682 1.4509 +173 +1.18%
EURGBP 0.7484 0.7454 +30 +0.40%
EURCHF 1.6048 1.6008 +40 +0.25%
EURJPY 158.18 155.74 +244 +1.54%
EURCAD 1.4780 1.4494 +286 +1.94%
Yen
USDJPY 107.73 107.33 +40 +0.37%
EURJPY 158.18 155.74 +244 +1.54%
GBPJPY 211.30 208.84 +246 +1.16%
AUDJPY 97.89 96.11 +178 +1.82%
NZDJPY 85.00 84.61 +39 +0.46%
Sterling
GBPUSD 1.9613 1.9458 +155 +0.79%
EURGBP 0.7484 0.7454 +30 +0.40%
GBPCHF 2.1437 2.1466 -29 -0.14%
GBPJPY 211.30 208.84 +246 +1.16%
GBPCAD 1.9748 1.9440 +308 +1.56%

Dollar weakened generally last week on intensified worry of recession in the US economy after dovish Bernanke Testimony as well as a string of poor economy data. That was a sharp contrast to the situation down under in Australia with Aussie boosted by strong economic data and a hawkish monetary policy statement from RBA. Euro recovered most of prior week's losses while the Japanese yen weakened in general after global stock markets stabilized. FOMC minutes will be the main feature next week but the another bunch of US economic data will likely be the trigger of further volatilities in the markets.

Dollar was lifted earlier last week after surprisingly solid retail sale report that suggested that consumers were just down but not out. Headline sales rose 0.3%, up from Dec’s 0.4% fall and beat expectation of -0.3% fall. A 0.6% gain in autos boosted overall sales in January. Ex auto-sales also rose 0.3%, beating expectation of 0.2%. However, the strength in dollar was brief and dollar turned around after dovish testimony of Bernanke.

Dollar weakened generally across the board after Bernanke's Testimony before Senate. While the testimony was brief, the message was clear. "The outlook for the economy has worsened in recent months, and the downside risks to growth have increased." Risks to growth in the US outweigh inflation and further rates are likely from Fed as the Fed needs to provide "adequate insurance against downside risks." Baseline forecast suggest growth in first half will be sluggish even though the change in monetary policy and fiscal stimulus package will support a stronger economy in the second half. Credit conditions could also tighten further.

Former Fed chairman Alan Greenspan said that US economy is "clearly on the edge" of recesssion.He reiterated earlier comments that odds of an economic contraction are "50 percent or better."

Dollar was further hammed after surprisingly weak NY State Manufacturing index spurred further worries on risks of deeper slowdown and recession in the US economy. The index unexpectedly sank from 9.0 to -11.7, marking the first contraction reading in nearly three years. University of Michigan consumer sentiment also fell to a 16 year low of 69.3.

As the week closed, interest rates futures show a 68% chance Fed will lower its target for overnight lending between banks by 0.5 bps to 2.5% at its next scheduled meeting on Mar 18. The remaining bets are for a 0.75 bps reduction.

Other data from US saw business inventories rose 0.6% in Dec. Trade deficit in US narrowed more than expected by 6.9% from -63.1b -58.8b, better than expectation of -61.0b, thanks to rising exports and falling imports. The goods deficit with China also narrowed 0.6% to 18.8b. Jobless claims dropped 9k from 357k to 348k near to the 4 week average of 347k. TIC capital flow dropped more than expected to 56.5b in Dec. Industrial production rose 0.1% in Jan, inline with consensus while capacity utilization was unchanged at 81.5%. Import prices rose more than expected by 1.7% mom, 13.7% yoy in Jan.

Germany ZEW investor confidence unexpected improved from 15 year low of -41.6 to -39.5 in Feb. Q4 GDP in Eurozone rose 0.4% qoq, 2.3% yoy, slightly better than expectation of 0.3% qoq, 2.2% yoy. Industrial production dropped -0.1% in Dec, dragging yoy rate down to 1.3%. Eurozone trade balance posted first deficit in 16 months, at -4.2n.

BoJ left rates unchanged at 0.50% as widely expected, by unanimous vote. In the monthly report , BoJ left economic assessments unchanged, saying that the Japanese economy is still expanding moderately even though the space is slowing due to drop in housing investment. Fukui later mentioned that risks to the Japanese economy have heightened and inflation risks are smaller than those of the US and Europe.

Japanese Q4 GDP rose 0.9% qoq with annualized rate at 3.7%. Both were much stronger than expectation of 0.4% and 1.5%. The report suggests growth in Japan is still robust but two issues undermined the strength of the result. Firstly, the stronger Q4 result was somewhat inflated by lower base effect in Q3, in particular considering the second downward revision. Secondly, the GDP deflator dived further negative to -1.3% which suggests that real GDP was inflated. Other data from Japan saw industrial production rising 1.4% mom, 0.8% yoy.

Japanese wholesale inflation hits 27-year high. Domestic CGPI climbed from 2.6% yoy to 3.0% yoy, beating expectation of 2.8% on rising oil and material costs. Trade surplus rose to 1013b, slightly below consensus of 1027b. While exports to US continued to drop by 4.5% Dec, exports to Asia offset that and rose 8.2%. Exports to EU rose 2.4%. Consumer confidence in Jan dropped from 38.2 to 37.9 in Jan. Capacity utilization rose from 018.4 to 110.2 in Dec. Jan machine tools orders was flat.

Though, the Japanese yen paid little attention in these events and focused on the stock markets and carry trades instead. The yen was pressured with stock markets stabilized after Warren Buffett offered to help out troubled bond insurers.

The BOE Quarterly Inflation Report was the main feature in UK last week. While further easing is still expected from BOE, the Quarterly Inflation Report suggested that it wont 'be aggressive. The report noted that higher energy, food and import prices will push inflation up sharply in the near term, and could reach around 2.1% which Governor will be required to write a letter to Chancellor of Exchequer Darling. However, “tighter credit conditions and weaker real income growth (will) bear down on domestic demand” and will slow inflation back to the 2% target. The bank based its forecasts on investors' bets for the benchmark interest rate to fall to 4.5% by the end of the year.

Inflation data from UK were mixed. PI input rose sharply from revised 12.2% to record high of 19.1% in Jan, much stronger than expectation of 14.3%. Out PPI also climbed from 5.0% yoy to a 16 year high of 5.7%, beating consensus of 5.1%. Core PPI rose from 2.5% yoy to 3.1% vs expectation of 2.6%. Though, headline CPI dropped more than expected by -0.7% mom in Jan, while yoy rate climbed less than expected to 2.2% only. Core CPI indeed slowed from 1.4% yoy to 1.3% yoy. Both RPI and RPI-X beat expectation and climbed to 4.1$ yoy and 3.4% yoy respectively.

There was also additional support to sterling from improvements in the job markets. ILO unemployment rate unexpected fell from 5.3% to 5.2% for the three months smoothed to Dec. Claimant count held unchanged at 2.5% in Jan, dropping -10.8k, double the consensus expectation amount and reached the lowest level since June 1975.

Canadian dollar traded with an undertone last week and weakened sharply on Friday. Canadian dollar was pressured by disappointing trade surplus which shrank to 9 year low of 23.5b in Dec. Further selloff was seen after Dec manufacturing shipment dropped sharply by -3.4%.

Some volatility was seen in the Aussie during last week but after all, it did managed to strengthen solid expectation for further rate hike from RBA. In the Quarterly Monetary Policy Statement, RBA revised inflation forecast for the year to Jun 2008 up from 3.25% to 3.75%, well above its 2-3% target band. The bank said the inflation risk was "uncomfortably high". More importantly "monetary policy is likely to need to be tighter in the period ahead." in absence of a "shift in economic risks to the downside". Markets generally took the statement as a signal that RBA will continue the current tightening cycle, even after the bank raised rates to 11 year high of 7.00% las week. Unemployment rate unexpectedly dropped to a record low of 4.1% in Jan, much better than expectation of 4.3%. Job growth rose to 26.8k, also much stronger than expectation of 15k.

Mid-Day Report: Yen and Swiss Franc Rebound as NY State Survey Spurs Recession Worry

2008-02-16T04:04:00.000-08:00

Market Overview | Written by ActionForex.com | Feb 15 08 14:39 GMT |
Mid-Day Report: Yen and Swiss Franc Rebound as NY State Survey Spurs Recession Worry

The Japanese yen and Swiss Franc are boosted in early US session after a surprisingly weak NY State Manufacturing index spurred worries on risks of deeper slowdown and recession in the US economy. The index unexpectedly sank from 9.0 to -11.7, marking the first contraction reading in nearly three years. Stocks are set to have a lower open in the US. Yen and Swissy both rebounds strongly against the greenback on risk aversion. Meanwhile, dollar is mixed against other major currencies. Other data from US saw TIC capital flow dropped more than expected to 56.5b in Dec. Industrial production rose 0.1% in Jan, inline with consensus while Capacity utilization was unchanged at 81.5%. Import prices rose more than expected by 1.7% mom, 13.7% yoy in Jan.

Euro remains firm against the greenback today even though Eurozone trade balance posted first deficit in 16 months, at -4.2n. BoJ left rates unchanged at 0.50% as widely expected, by unanimous vote. In the monthly report , BoJ left economic assessments unchanged, saying that the Japanese economy is still expanding moderately even though the space is slowing due to drop in housing investment. Fukui later mentioned that risks to the Japanese economy have heightened and inflation risks are smaller than those of the US and Europe.
USD/CHF Mid-Day Outlook

Daily Pivots: (S1) 1.0928; (P) 1.1013; (R1) 1.1061; More

USD/CHF's sharp fall from 1.1105 and break of 1.0935 support indicates that rebound from 1.0729 has completed at 1.1105, after just failing mentioned key near term resistance of 1.1120 cluster resistance (38.2% retracement of 1.1596 to 1.0836 at 1.1126 and 138.2% projection of 1.0836 to 1.1120 from 1.0729 at 1.1121). Intraday bias is flipped to the downside for a retest of 1.0729 low. Break will confirm that consolidation that started at 1.0836 has completed already. In such case, fall from 1.1596 has resumed for next downside target of 61.8% projection of 1.1596 to 1.0836 from 1.1105 at 1.0635 first. On the upside, above 1.0988 minor resistance will turn intraday outlook consolidative first.

In the bigger picture, whole down trend from 1.3283 (05 high) is still in force. The preferred interpretation is that fall from 1.3282 was initially contained at 1.1919 and turned into sideway triangle consolidation that completed at 1.2467, where the medium term down trend from 1.3283 resumed . Having said that, next medium term downside target will be 161.8% projection of 1.3283 to 1.1919 from 1.2467 at 1.0260. Also, such medium term decline is tentatively treated as resumption of the long term down trend from 1.8305 (00 high) which could extend further to parity. Sustained break of 1.1596 is needed to indicate whole down trend from 1.3283 has completed. Otherwise, long term outlook will remain bearish

TFN NEWS BRIEFING: Macroeconomics highlights to 10:10 GMT

2008-02-16T03:25:00.001-08:00

Sat, Feb 16 2008, 10:25 GMT
http://www.afxnews.com

2008-02-15 23:36:39

Metals at a glance

NEW YORK (AP) - The following are key metals settlement prices Friday,

compared with late Thursday, on the New York Mercantile Exchange:

April gold $906.10, down $4.70 an ounce

March silver $17.118, down 13.7 cents an ounce

March copper $3.5230, up 3.5 cents a pound

MARKET SNAPSHOT: Market Still Facing Headwinds From Credit, Economy

2008-02-16T03:20:00.000-08:00

Sat, Feb 16 2008, 05:05 GMT
http://www.djnewswires.com/eu

MARKET SNAPSHOT: Market Still Facing Headwinds From Credit, Economy

By Carla Mozee

Investors will look for U.S. stock gains to continue for a second consecutive week, but the market faces high hurdles from the ongoing credit crisis and recession fears that continue to hang over the market.

Market players will turn their attention to results from retailing giant Wal-Mart Stores Inc. (WMT) and a consumer-price inflation report that will shed more light on consumer activity in a sluggish economy.

A close eye will also be paid to action in the bond-insurance market, after New York Governor Eliot Spitzer warned Thursday that bond insurers have to move quickly to recapitalize themselves to keep their AAA ratings.

Fresh off the central bank's downgrade of the U.S. economy, investors will return from Monday's holiday to reports from the beleaguered housing sector and results from J.C. Penney Co. (JCP) and tech heavyweight Hewlett-Packard Co. (HPQ)

A three-day snapback rally, interrupted by a sell-off on Thursday, was enough to pull the major stock indexes higher this week, but it wasn't enough to convince Joe Liro, equity strategist at Stone & McCarthy Research Associates, that the market is ready to extend gains.

"As soon as you got some upside, people came in to sell. When you're selling bounces rather than buying dips, that's a clear indication that the overall trend is lower," he said.

Wall Street also will watch for results from European banking firms, many of which have been hit by the U.S. mortgage meltdown.

While concerns about recession loom large on Wall Street, Liro said that he considers the weak performance of the financial sector as the most "debilitating" factor for the market.

If the constant "litany of admissions of bigger write-downs and charges continues, it's has to be a negative next week," he added.

Britain's Barclays PLC (BCS) will report on Tuesday and France's BNP Paribas , which has warned of lower fourth-quarter profit, will report Wednesday. This week, Swiss banking giant UBS AG (UBS) recorded a $13.7 billion write-down in the fourth quarter related to its extensive exposure to the U.S. mortgage market.

Results are also due from Societe Generale , the French bank in the middle of a rogue-trading scandal that is expected to result in more than $7 billion of losses at the company.

Steven Sachs, head of trading at Rydex Investments, foresees little chance that stocks will move higher next week, particularly if Wednesday's consumer-price index report shows that consumers shelled out more money for goods and services in January.

A miss in expectations for CPI readings to remain steady "given Federal Reserve Chairman Ben Bernanke's testimony on the Hill and [Treasury Secretary Henry] Paulson's claim that inflation is not a concern and it will moderate" would hit stocks, said Sachs, who met the monetary officials' view about inflation with skepticism.

Economists polled by MarketWatch forecast the CPI to remain unchanged at 0.3%. Stripping out volatile prices for food and energy, core consumer prices are expected to stay at 0.2%.

As investors prepped for the upcoming inflation report and highly anticipated results from Wal-Mart, the world's largest retailer, signs abounded that consumers (whose spending drives about 70% of the U.S. economy) are becoming increasingly reluctant to part from their cash.

Consumer-electronics retailer Best Buy Co. (BBY) cut its full-year earnings forecast Friday because of lackluster sales after the holiday season, then consumer sentiment tumbled to its lowest level since 1992, according to a survey by the University of Michigan and Reuters.

Those developments followed Bernanke's congressional testimony Thursday said that the central bank is projecting slower growth for 2008 than in previous forecasts. Investors will hear more from the Fed on Wednesday when minutes from its most recent meeting will be released.

Investors also will get a look on Friday at the Philadelphia Federal Reserve's manufacturing survey, whose poor showing last month set off alarm bells to many on Wall Street that recession was on its way.

"Bad news is we are probably going to be in a recession. The good news is that while rate cuts cannot stop a recession, they can help to reduce the severity," said Al Goldman, chief market strategist at A.G. Edwards. "But after the rally, the dominant trend is still down, and I think that's probably going to be the direction on balance next week."

Earnings, reports

Following the Presidents Day holiday on Monday, investors on Tuesday will receive results from Wal-Mart and look for further insight into how consumers are holding up during the current economic slowdown.

Wal-Mart is expected to report a 10% rise in profit to $1.02 a share on sales of $107 billion, according to analysts polled by Thomson Financial. But in its most recent sales release, the company posted a soft 0.5% gain in same-store sales for January, below expectations of 2% growth.

Chipmaker Analog Devices Inc. (ADI) will post results Wednesday. Utility firm PG&E Corp. (PCG) and financial-software provider Intuit Inc. (INTU) will report on Thursday.

Fourth-quarter earnings growth for companies in the S&P 500 continued to weaken this past week, and now stands at negative 21.1%.

"That was down mostly due to estimate cuts to American International Group Inc. (AIG)," said John Butters, senior research analyst at Thomson Financial.

The insurer reported that its auditor questioned how the company values some of its derivatives. AIG, however, said that it has appropriate controls and procedures in place to value such exposures.

Earnings growth is on track for the worst year-over-year decline since 2001. Of the 480 companies that already have reported results, 27% of them have missed Wall Street's estimates. That's above the long-term average of 20% of companies that post below than expected figures.

The National Association of Home Builders will release its home-builder sentiment index on Wednesday, and the Commerce Department will release its January report on building permits and housing starts. Housing starts are expected remain steady, with 1.01 million homes slated for construction.

Friday's market

The Dow Jones Industrial Average (DJI) ended down 26 points at 12,348.21, but posted a 1.4% rise for the week.

The S&P 500 Index (SPX) rose 1 point to 1,349.99 for a 1.4% weekly gain. The Nasdaq Composite Index (RIXF) fell Friday by 11 points to 2,321.80 but rose 0.7% for the week.

Treasury bonds mostly rose, putting yields under pressure, as investors fled to the safety of government debt on rekindled worries about the U.S. economy and the credit markets.

Crude-oil ended nearly flat at $95.50 a barrel on the New York Mercantile Exchange.

Gold for April delivery fell $4.70 to end at $906.10 an ounce, while platinum futures extended their record-breaking run Friday on persistent worries about supply disruptions in South Africa. Platinum for April delivery soared as high as $2,079.90 an ounce.

(END) Dow Jones Newswires

February 16, 2008 00:05 ET (05:05 GMT)

2008-02-15T20:55:00.000-08:00

Metals at a glance
Fri, Feb 15 2008, 23:51 GMT
http://www.afxnews.com
NEW YORK (AP) - The following are key metals settlement prices Friday, compared with late Thursday, on the New York Mercantile Exchange:
April gold $906.10, down $4.70 an ounce
March silver $17.118, down 13.7 cents an ounce
March copper $3.5230, up 3.5 cents a pound

Treasurys higher on weak manufacturing
Fri, Feb 15 2008, 22:58 GMT
http://www.afxnews.com
NEW YORK (AP) - Long-term Treasury prices rose Friday after the New York Federal Reserve reported that manufacturing in its region contracted this month. Another gauge showed that nationwide consumer confidence skidded to a 16-year low.
The news sent the yield on the rate-sensitive two year note briefly down to its weakest level in four years. Prices and yields move in opposite directions.
The New York Fed's Empire State index of factory activity plunged almost 21 points to a negative 11.7 reading, the weakest level in almost three years. Readings below zero show shrinkage. February also marked the fourth straight decline for the index. Economists had expected a much healthier reading of 5.75, according to Thomson/IFR.
The report helps build a case that the economy is on the brink of recession, although a recession requires two consecutive quarters of contraction and can only be declared in hindsight.
Separately, the Reuters/University of Michigan's consumer sentiment index dropped to 69.6 this month, its worst level since 1992 and down sharply from 78.4 in January. Although the news triggered a strong reaction in the bond market, some economists caution that consumer cash flow is a more tangible metric than sentiment readings.
Although the data has negative portents for the economy, it is helpful to the Treasury market, as investors generally turn to government-backed bonds when they are worried about the economy.
In addition, the report puts extra pressure on the Fed to continue cutting interest rates. The central bank cut the overnight Fed funds rate by 1.25 percentage points in January. Fixed-income investors want to see more rate cuts to rejuvenate ailing debt markets.
The benchmark 10-year Treasury note rose 9/32 to 97 24/32 with a yield of 3.77 percent, down from 3.82 percent late Thursday, according to BGCantor Market Data.
The 30-year long bond gained 25/32 to 96 24/32 with a yield of 4.58 percent, down from 4.65 percent the day before.
However, there was some selling pressure on short-term notes.
The 2-year note fell 3/32 to 100 12/32 with a 1.92 percent yield, up from 1.90 percent late Thursday. Immediately after the sentiment report the 2-year yield touched 1.82 percent, its worst level since 2004.
After hours trade had no impact on yields. At 5:30 p.m. Eastern the 10-year yield remained 3.77 percent, the 30-year yield was still 4.58 percent and the 2-year yield stood at 1.92 percent.
The yield on the 3-month note fell to 2.21 percent from 2.27 percent on Thursday, as the discount rate dropped to 2.16 percent from 2.24 percent.
In other data news, the Fed said industrial output rose modestly last month, due to strength in the utility sector. Industrial production increased 0.1 percent in January, in line with December's rise and analysts' expectations.
Separately, the Labor Department reported that U.S. import prices rose 1.7 percent in January, as oil prices jumped. In December, prices slipped 0.2 percent.
Demand for Treasurys Thursday also was stoked by a complex barrage of negative developments elsewhere in the credit markets. Since the subprime issue first surfaced last summer, Treasurys have been the asset of choice for investors spooked by the unraveling of normally stalwart forms of debt assets.
This week saw turmoil in the market for short-term auction-rate munis when bidders could not be found for weekly notes offered by a number of top-rated local government issuers. There also are mounting problems in the leveraged loan market, as well as some ongoing weakness in corporate short-term commercial paper.
"In 25 years of working in this business, I don't believe I have seen more market disruption from so many different sources," said Kevin Giddis, managing director of fixed-income trading at Morgan Keegan.
The unusual degree of queasiness about debt issued by highly reliable companies and municipalities is linked to worries about bond insurers that unwisely backed subprime debt. There are concerns that they may not be able to shore up enough capital to withstand an expected avalanche of defaults.
One of the wobbly bond insurers, FGIC Co., agreed to be split into two separate entities. One would house its structured finance business where its troubled subprime assets are sheltered. The other would contain the municipal bonds that FGIC backs which normally are considered desirable.

Bear market looms, but will it linger?
Fri, Feb 15 2008, 22:00 GMT
http://www.afxnews.com
NEW YORK (AP) - Bear markets are a bit like recessions: Investors don't know they're in one until it's almost over. But they can feel the pain.
Although a bear market can't be officially declared yet, traders are certainly pessimistic. The Standard & Poor's 500 index posted another lackluster week as Wall Street's three main stock gauges hovered at their lowest levels of the year.
The four-year bull run had catapulted equities markets to all-time highs, with the Dow Jones industrial average smashing through the 14,000 mark in October. A growing number of analysts believe a bear market is now under way, but that doesn't mean shrewd investors can't make money.
"I do think we are going to end up being in a bear market because the problems with financial stocks are continuing to drag out," said Peter Dunay, chief investment strategist for New York-based Meridian Equity Partners. "Money will flow from one thing to the next, one week investors will go bottom-fishing and then they'll sell off on bad news."
Dunay said "it is all about the fast money" these days as big institutional investors -- such as hedge funds -- lay down bets and cash out quick. That offers some explanation for how stocks have behaved during the past three weeks -- and clues about what to expect.
This past week, major indexes finished slightly higher. The previous week, the indexes gave up more than 4 percent; and, before that, two days of stunning gains were enough to give the Dow its first weekly advance of 2008.
Behind these gyrations are fears that the economy continues to slow, and is even sinking into recession. Analysts are worried that the subprime crisis that roiled markets since the summer are working their way deeper into the economy.
Banks have racked up about $150 billion in write-offs from bad bets on asset-backed securities. And there's continued evidence the pain is spreading: This past week bond insurer Financial Guaranty Insurance Co. said it wanted to separate into two companies, splitting its municipal bond business from its insurance on riskier financial instruments.
Meanwhile, recent data indicates that consumer spending -- the biggest driver of the U.S. economy -- is slowing. The full effects of this would be widespread, hurting everything from profit at retailers to employment.
All of that could easily tip major market indexes into the technical definition of a bear market, which is when stocks are down 20 percent from a recent high. The Dow, S&P 500 and Nasdaq composite are all on the verge of hitting that mark.
The S&P 500, considered the broadest market indicator, was down 13.75 percent from its Oct. 9 high as of Friday. The Dow was down 12.82 percent and the tech-heavy Nasdaq was off 18.79 percent, both from their October highs.
However, experts warn that the bear market label might give investors a false impression that they're locked into losses.
"There's an old adage that fortunes are made in bear markets, but you just don't know it at the time," said Quincy Krosby, chief investment strategist at The Hartford. "There are trading opportunities because there are some strong spikes. ... Emblematic of a bear market is that you sell into strength and buy on the dip."
Krosby said that investors should look for solid companies that are "beaten down for no apparent reason" that will provide long-term opportunity. Even more specifically, she said, at some point, financial companies like banks and brokerages will truly be the sector to watch.
Investment banks like Bear Stearns Cos. and Merrill Lynch & Co. have plunged in the past year on credit concerns. This past week analysts who cover the financial sector warned that even Goldman Sachs Group Inc. -- which has so far escaped the brunt of the crisis -- will begin to show strain when it reports first-quarter results next month.
Dunay agrees that the financial sector will be a crucial one for a turnaround. In the meantime, he said there are different strategies short-term and long-term investors should take.
"The idea is if you're longer term, the investing style will be to preserve your capital," he said. "For short-term traders, you're just waiting around for the next big wave."

Nebraska home sales fall
Fri, Feb 15 2008, 21:41 GMT
http://www.afxnews.com
OMAHA, Neb. (AP) - Sales of existing homes dropped last year in Nebraska, but the figures still painted a brighter picture than national trends.
The latest figures from the National Association of Realtors show that Nebraska sales of used single-family homes, town homes, condos and co-ops plummeted 17.6 percent for the fourth quarter of 2007 and 4.9 percent for the year.
That compares favorably with national sales figures: a plunge of 20.9 percent in the fourth quarter and 12.8 percent for the year, compared with 2006 figures.
Sales of existing homes fell in 45 states during the October-December quarter, the association said.
Nebraska's figures also were not as bad as those for the Midwest as a whole.
Midwest sales dropped 18.1 percent in the fourth quarter and 10.6 percent for the year.
The figures reflect adjusted annual rates, not actual sales records, in order to factor out season variations for resales. The association said the rate for any quarter "represents what the total number of actual sales for a year would be if the relative sales pace for that quarter was maintained for four consecutive quarters."
Prices are another measure of the housing industry's well-being, suggesting good news for Omaha and Lincoln.
Lincoln's median price for the quarter rose to $138,800 from $137,700, an increase of 0.7 percent. Omaha's rose 2.1 percent, to $142,800 from $136,200.
Median home prices fell in more than half of the 150 metropolitan areas surveyed by the association.
Walter Molony, a spokesman for National Association of Realtors, said the two regions' "price performance would indicate a little bit better balance between buyers and sellers" than many other parts of the country, where buyers are having their financial way with sellers.
Doug Rotthaus, executive vice president of Realtors Association of Lincoln, said he thinks the relatively good numbers relate "to the overall stability of the market."
"We have a history of slower growth but more steady growth," Rotthaus said. "Our numbers indicate that we didn't go up as rapidly, but we're not seeing that correction in the overall proportion as some areas of the country."
In fact, more existing homes were sold in Lincoln last year, 2,922, than in 2006, 2,874. The record was 3,030 in 2005, Rotthaus said.
"The demand for existing homes is somewhat steady," he said, but there are more homes on the market than usual. The latest figure he had 2,083 on Dec. 31, which was about 1.5 percent more single-family homes, including new ones, than the same date a year earlier.
He also said Lincoln had fewer new home starts last year: 843 permits issued in 2007, versus 1,021 in 2006.
Molony with the national realtors group said the states and metropolitan areas that are doing better are the ones "that preserve good affordability conditions."
Lawrence Yun, the Realtors Association's chief economist, said the healthiest housing markets "generally are moderately priced and are experiencing job growth."
Nebraska has long been among the most affordable states for housing. A 2006 U.S. Census report listed Nebraska No. 39 for the median price of owner-occupied housing units, $119,200, versus the U.S. median of $185,200 and No. 1 California, at $535,700.
The Nebraska unemployment rate remains low as well: 3.2 percent in December, compared with 5 percent nationally.
The state Labor Department says Nebraska has added 13,571 jobs since December 2006, a growth rate of 1.4 percent.

Dollar down after weak manufacturing
Fri, Feb 15 2008, 21:18 GMT
http://www.afxnews.com
NEW YORK (AP) - The dollar extended its slide Friday against most major currencies after weak manufacturing data and consumer sentiment drove home Federal Reserve Chairman Ben Bernanke's comments about a gloomy economy and the possibility of further interest rate cuts.
Lower interest rates can jump-start a country's economy, but may weigh on its currency as traders transfer funds to countries where they can earn higher returns.
The 15-nation euro rose to $1.4678 Friday from $1.4633, but the dollar jumped higher against the pound. The British currency fell to $1.9603 from $1.9691.
The dollar also slipped to 107.69 Japanese yen from 107.93 yen and dropped to 1.0925 Swiss francs from 1.0973 francs.
A New York Federal Reserve survey showed that manufacturing conditions in the region had deteriorated, while the central bank said that the country's industrial output rose by only 0.1 percent in January. The increase in industrial production was due mostly to higher output at utility companies because of the weather.
A preliminary Reuters/University of Michigan survey showed consumer confidence sank in February to a 16-year low.
Bernanke told Congress on Thursday the economy outlook was gloomy and signaled a readiness to keep on lowering a key interest rate to shore things up.
Bernanke also told the Senate Banking Committee that the one-two punch of housing and credit crises has greatly strained the economy. And he forecast sluggish growth in the near term. Bernanke also noted that hiring has slowed and that people are likely to tighten their belts further because of high energy prices and plummeting home values.
In other New York trading, the dollar rose to 1.0091 Canadian dollars from 99.99 Canadian cents.

New York Money Market Rate Indications
Fri, Feb 15 2008, 21:02 GMT
http://www.djnewswires.com/eu
New York Money Market Rate Indications
Bankers acceptances at 3:46 p.m. New York time.
1M 3.12
2M 3.10
3M 3.70
6M 2.95
9M 2.88
1Y 2.83
Federal funds: days high 3.15; low 2.93: latest bid 3.00; offered 3.06; prime lending rate at major banks 6.00; broker call loan rate 4.75

Dealer-placed commercial paper
30 days 3.07
60 days 3.05
90 days 3.03

Treasury bills
30 days 2.33-32 dn .120
90 days 2.15-14 dn .080
180 days 2.02-01 dn .020

Moody's yield figures
AAA corps 5.67

Argentina Stks Follow Regional Mkts Lower; Bonds Edge Higher
Fri, Feb 15 2008, 20:53 GMT
http://www.djnewswires.com/eu
Argentina Stks Follow Regional Mkts Lower; Bonds Edge Higher

By Drew Benson

Of DOW JONES NEWSWIRES

BUENOS AIRES(Dow Jones)--Argentine stocks floated lower Friday in line with regional markets, while locally traded bond prices edged higher.

The peso, meanwhile, firmed slightly to ARS3.1525 per dollar from Thursday's close at ARS3.1575.

The Buenos Aires Stock Exchange's benchmark Merval Index ended 0.13% lower at 2,039.09 points, while the broader General Index slid 0.19% to 116,026.88 points. Volume was ARS166.6 million, with a low ARS59.1 million of that comprising local shares traded.

Steel tube maker Tenaris (TS) saw the heaviest trading on the Merval, ending 0.73% lower at ARS60.45, while energy investment fund Pampa Holding (PAMP.BA) slid 1.31% to ARS2.25. On the upside, PVC maker Solvay Indupa (INDU.BA) jumped 3.39% to ARS4.87%, after reporting that fourth quarter net profit rose 54.8% on the year to ARS69.7 million.

In the local bond market, the price of the Discount bond in pesos rose to ARS117.50 from ARS117, while the Par in pesos rose to ARS41.35 from ARS41.

Traders expect little local activity Monday due to the U.S. Presidents Day holiday.

-By Drew Benson, Dow Jones Newswires; 5411-4311-3127; andrew.benson@dowjones.com

(END) Dow Jones Newswires

February 15, 2008 15:53 ET (20:53 GMT)

Companies' cash-like holdings pose risks
Fri, Feb 15 2008, 20:51 GMT
http://www.afxnews.com
WASHINGTON (AP) - As corporate losses mount from investments that until recently seemed as safe as cash, shareholders are in a pickle: They don't know the severity of the problem or which companies are affected.
So far, Bristol-Myers Squibb Co., US Airways Group Inc., Qwest Communications and others have disclosed multimillion-dollar losses on a common type of higher-yielding bonds marketed as short-term and low-risk.
Such descriptions for these investments, known as auction-rate securities, were at best wishful thinking in the era of easy credit that helped fuel the housing boom. But as credit tightens on Wall Street and around the globe, it has become extremely difficult for companies and wealthy individuals to sell these securities, which are backed by mortgages, student loans and municipal bonds.
"The problem is quite widespread," said Lance Pan, director of investment research at Capital Advisors Group Inc. in Newton, Mass. "There will be more confessions to be made by large corporate investors."
For years the securities were attractive to investors because they offered a slightly better return than ultra-safe investments such as Treasury bills at a time when interest rates were relatively low. Over the past week, however, there have been barely any buyers in the more than $300 billion market as investors have shied away from all but the safest places to put their money.
Since some of these investments are backed by troubled bond insurers, investors have been particularly queasy. Hundreds of auctions have failed over the past week, driving up the interest rates for securities that do get auctioned off. That makes it more expensive for municipalities to raise money through bond sales.
Investors' growing aversion to auction-rate securities doesn't mean the assets underlying them are worthless; but the companies that own the securities are increasingly under pressure to acknowledge in future financial statements that their value has dropped. Auction-rate securities can be held by mutual funds, but not money-market funds.
Wall Street's inability to attract investors for these securities is also a big problem for government agencies selling the debt, including student loan programs in Michigan and Montana, and the operator of airports, tunnels and ferries in New York and New Jersey.
After a failed auction on Tuesday, the Port Authority of New York and New Jersey has had to temporarily pay interest rates of 10 percent or more while it looks for other ways to sell bonds to avoid these high interest costs.
Jeff Glenzer, a managing director of Association for Financial Professionals, a Bethesda, Md. based trade group for corporate financial officers, said the problems in the auction-rate market reinforce a time-honored saying: If something looks too good to be true, it probably is.
Alarms were sounded about risks in the auction-rate market long before the latest flare-up. The Securities and Exchange Commission in May 2006 fined 15 Wall Street firms $13 million to settle charges that they had manipulated the market.
Still, Robert Salomon, a professor at New York University's Stern School of Business, said many executives likely were unaware of what they were buying. "I would expect to see corporate treasurers raise the question of: well, what the heck is in our portfolio?" he said.
Companies are not required to break out the details of these investments and typically only do so if they go bad. That presents a puzzle for financial analysts trying to get a handle on the problem.
Merrill Lynch analyst Tai Liani in January published a report examining 190 technology companies for their exposure to risky short-term investments, and found that 44 had invested some of their cash in riskier assets. However, Liani noted in the report that limited disclosures "make it virtually impossible for us to assess the quality of the underlying assets."
Last fall, US Airways warned in an SEC filing that $411 million of its $3.13 billion in cash and short-term investments was tied up in auction-rate securities that did not find buyers in auctions. The company warned that -- if it needed the money -- it would have to sell the debt at below-cost and estimated the securities' value at $373 million. Last month, US Airways took a $10 million charge on the securities.
Pharmaceutical company Bristol-Myers Squibb in late January reported a $275 million impairment charge due to auction-rate bonds that it said were linked to mortgage investments. Bristol-Myers' treasurer, Edward Dwyer, no longer works for the company, a company spokeswoman said, declining further comment.
And earlier this week, telephone company Qwest Communications said it classified $116 million in auction-rate securities as noncurrent because the company has been unable to sell its holdings.
Placing a value on bonds that are still making interest payments but for which there is no market is bound to be especially tricky, experts say. Auditors are likely to err on the side of caution.
Some in the industry fear auditors will push companies into taking larger-than-necessary write-downs.
"We're telling people to fight back," said Lee Epstein, chief executive of San Francisco-based Money Market One, which sells the securities.
Epstein also said he sees signs that the market is beginning to recover, as rates have risen to the point -- 10 to 11 percent -- where they are irresistible for investors.

Mexico's Peso Firms To 10.7525/Dlr As Ctrl Bank Holds Rates
Fri, Feb 15 2008, 20:44 GMT
http://www.djnewswires.com/eu
Mexico's Peso Firms To 10.7525/Dlr As Ctrl Bank Holds Rates

By Anthony Harrup

Of DOW JONES NEWSWIRES

MEXICO CITY (Dow Jones)--Mexico's peso strengthened fractionally against the dollar Friday as the Bank of Mexico left interest rates unchanged at its monthly meeting.

The peso was quoted in Mexico City closing at MXN10.7525 to the dollar, compared with MXN10.7620 at the opening and MXN10.7585 at Thursday's close.

The currency remained firm despite a drop in local stocks, which were off 1.3% on renewed worries about U.S. eocnomic growth.

U.S. industrial production rose modestly last month, but regional manufacturing data and consumer confidence data were discouraging, contributing to U.S. stock losses.

Mexican government bonds gained ground, however, pushing yields down, after the central bank left its overnight rate target at 7.5%, as expected.

The Bank of Mexico said economic growth risks related to the U.S. slowdown had increased, and that food price pressures remain although inflation has so far behaved as expected.

The yield on government bonds due 2016 was off 2 basis points to 7.52%, and the yield on bonds maturing 20-24 was down 2 basis points to 7.63%.

Investors had taken profits in bonds in recent sessions following a rally on expectations that the central bank will cut interest rates this year.

Banamex said it found no evidence in Friday's statement to suggest the Bank of Mexico won't lower interest rates, saying it expects a first rate cut in September. Others expect the bank to start leasing monetary policy before then.

-By Anthony Harrup, Dow Jones Newswires; (5255) 5080 3450; anthony.harrup@dowjones.com

(END) Dow Jones Newswires

February 15, 2008 15:44 ET (20:44 GMT)

Canada Afternoon: C$ Ends Sharply Lower In Thin Trading
Fri, Feb 15 2008, 20:44 GMT
http://www.djnewswires.com/eu
Canada Afternoon: C$ Ends Sharply Lower In Thin Trading

TORONTO (Dow Jones)--The Canadian dollar ended sharply lower Friday after earlier selling of the U.S. dollar prompted a short squeeze that sent the greenback scurrying higher against its Canadian counterpart in thin trading conditions.

Weak domestic manufacturing data for December were also a negative for the Canadian unit Friday.

The U.S. dollar was trading at C$1.0086 at 3:39 p.m. EST (2039 GMT), from C$0.9989 at 8:00 a.m. EST (1300 GMT) and C$0.9994 late Thursday.

It slipped to a low of C$0.9924 in overnight trading but had rebounded to the C$0.9970 area when Statistics Canada reported that manufacturing shipments were down 3.4% to C$48.63 billion (US$48.62 billion) after rising 1% the previous month, revised down from the preliminary 1.1% gain.

The market had expected a 0.1% loss.

Sales in constant dollars fell 5.8% to C$46.7 billion, the lowest level since August 2003. Overall 16 of the 21 manufacturing industries posted lower sales, accounting for nearly two-thirds of the total.

The U.S. dollar rallied back to the C$0.9995 area after the data, but then relinquished much of its gains to stabilize around C$0.9985.

However, in early afternoon trading it began a scramble higher that eventually took it to a sessional peak of C$1.0112 before it retreated somewhat.

Analysts said a short squeeze in the U.S. dollar in thin trading conditions was the main factor underlying Friday's turbulent trading.

"Basically, the market got squeezed a little bit. We tried to take out important support around C$0.9923 overnight and basically failed there," said George Davis, chief technical analyst for foreign exchange with RBC Capital Markets.

Around mid day, equity markets weakened and a U.S. dollar break above C$1.0024, that prompted an acceleration to the topside, he said.

"To be honest, I don't think there was much behind it. I think it was a little bit of stop loss buying and short covering, but liquidity was very, very thin," Davis said.

"At that point, I think most people were shutting down for the weekend here and south of the border," he said.

USD Rally Called A Little Bit Suspect

Foreign exchange trading in Canada will be sharply curtailed Monday for the newly instituted Family Day holiday in Ontario, while U.S. markets will be closed for Presidents Day. "It feels like the market was caught short (U.S.) dollars, today," said Steve Butler, director of foreign exchange at Scotia Capital.

He also said light, pre-holiday trading conditions contributed to the rapid move higher by the greenback.

Whether or not the U.S. dollar will be able to extend its gains when full trading reopens Tuesday isn't clear, but analysts said it's a distinct possibility.

"I don't know if I'd bet the farm that we're going to see a continuation, but it does feel like maybe we're headed back to C$1.0200, now," Butler said. "Just given the way things have gone today, I think the risk is as we move into early next week we'll see prices continue to rally and test the topside levels," Davis said.

"On the one hand, you can say this rally is a little bit suspect, given that it happened in almost-holiday markets and thin liquidity," he said.

But the move above C$1.0024 is significant and likely presages a move towards C$1.0119, a resistance point the U.S. dollar failed to break above last week, Davis said.

"If we get above there, we start looking at the C$1.0250 area," he added.

In other Canadian data, monthly new motor vehicle sales halted three months of declines in December and rebounded on strong truck sales.

Sales were up 4.8% to a seasonally adjusted 140,270 units, versus market expectations of a 3% increase.

While most market activity in Canada will be shut down on Monday because of the the Family Day holiday in Ontario, not all of the country is affected, and in Vancouver, Bank of Canada Governor Mark Carney will speak on the topic of "The Implications of Globalization for the Economy and Public Policy" at 4:15 p.m. EST (2115 GMT).

The text of his speech will be released at 4:00 p.m. EST (2100 GMT).

It will be followed by a news conference at 5:15 p.m. EST (2215 GMT).

These are the exchange rates at 3:39 p.m. EST (2039 GMT), 8:00 a.m. EST (1300 GMT), and late Thursday.
USD/CAD 1.0086 0.9989 0.9994
EUR/CAD 1.4812 1.4640 1.4629
CAD/JPY 106.89 107.78 108.21

-By Don Curren; Dow Jones Newswires;416-306-2020; don.curren@dowjones.com

(END) Dow Jones Newswires

February 15, 2008 15:44 ET (20:44 GMT)

CME Forex, Financial Estimated Futures Volumes - Feb 15
Fri, Feb 15 2008, 20:37 GMT
http://www.djnewswires.com/eu
CME Forex, Financial Estimated Futures Volumes - Feb 15
For today, in contracts.

Currencies Financials
Euro 115,288 Eurodollar 1,969,381
Japanese yen 85,260 Libor 4,436
Swiss franc 44,360 Euroyen 1
British pound 58,895
Canadian dollar 44,502
Australian dollar 31,623
Mexican Peso 11,580
New Zealand dollar 1,683
South African Rand 195
Brazilian Real 0
Russian Rubble 1,220

-By Kathy Lang; Dow Jones Newswires; 913-322-5172;
csstat@dowjones.com

CFTC Commitments: CME Mexican Peso Futures/Options-Feb 15
Fri, Feb 15 2008, 20:36 GMT
http://www.djnewswires.com/eu
CFTC Commitments: CME Mexican Peso Futures/Options-Feb 15

Mexican Peso - Chicago Mercantile Exchange
Option And Futures Combined Positions As Of 02/12/08 |
==============================================================| Nonreportable
Non-Commercial | Commercial | Total | Positions
==========================|=================|=================|================
Long | Short |Spreads | Long | Short | Long | Short | Long | Short
===============================================================================
(Contracts Of Mxn 500,000) Open Interest: 152,020
Commitments
111,054 5,026 659 34,044 144,244 145,757 149,929 6,263 2,091

Changes From 02/05/08 (Change In Open Interest: 30,895)
31,932 -2,034 -381 948 34,974 32,499 32,559 -1,603 -1,664

Percent Of Open Interest For Each Category Of Trader
73.1 3.3 0.4 22.4 94.9 95.9 98.6 4.1 1.4

Number Of Traders In Each Category (Total Traders: 107)
64 16 3 10 20 77 37

-By Kathy Lang; Dow Jones Newswires; 913-322-5172;
csstat@dowjones.com

2008-02-15T18:30:00.000-08:00

CFTC Commitments: ICE US Dlr Index Futures - Feb 15
Fri, Feb 15 2008, 20:32 GMT
http://www.djnewswires.com/eu
CFTC Commitments: ICE US Dlr Index Futures - Feb 15
U.S. Dollar Index - Ice Futures U.S.
Futures Only Positions As Of 02/12/08 |
==============================================================| Nonreportable
Non-Commercial | Commercial | Total | Positions
==========================|=================|=================|================
Long | Short |Spreads | Long | Short | Long | Short | Long | Short
===============================================================================
(U.S. Dollar Index X $1000) Open Interest: 36,980
Commitments
5,347 9,377 2,133 25,894 21,536 33,374 33,046 3,606 3,934

Changes From 02/05/08 (Change In Open Interest: -6,762)
-2,017 -6,433 -38 -4,446 145 -6,501 -6,326 -261 -436

Percent Of Open Interest For Each Category Of Traders
14.5 25.4 5.8 70.0 58.2 90.2 89.4 9.8 10.6

Number Of Traders In Each Category (Total Traders: 59)
18 26 5 9 6 30 35

-By Linda Rice; Dow Jones Newswires; 913-322-5173;
csstat@dowjones.com

CFTC Commitments: CME Canadian Dollar Futures-Feb 15
Fri, Feb 15 2008, 20:30 GMT
http://www.djnewswires.com/eu
CFTC Commitments: CME Canadian Dollar Futures-Feb 15

Canadian Dollar - Chicago Mercantile Exchange
Futures Only Positions As Of 02/12/08 |
==============================================================| Nonreportable
Non-Commercial | Commercial | Total | Positions
==========================|=================|=================|================
Long | Short |Spreads | Long | Short | Long | Short | Long | Short
===============================================================================
(Contracts Of Cad 100,000) Open Interest: 101,187
Commitments
43,391 22,956 1,639 22,399 60,784 67,429 85,379 33,758 15,808

Changes From 02/05/08 (Change In Open Interest: 7,613)
12,788 2,593 -137 -9,637 6,015 3,014 8,471 4,599 -858

Percent Of Open Interest For Each Category Of Traders
42.9 22.7 1.6 22.1 60.1 66.6 84.4 33.4 15.6

Number Of Traders In Each Category (Total Traders: 73)
25 15 4 18 22 47 37

-By Linda Rice; Dow Jones Newswires; 913-322-5173;
csstat@dowjones.com

CFTC Commitments: CME Swiss Franc Futures-Feb 15
Fri, Feb 15 2008, 20:30 GMT
http://www.djnewswires.com/eu
CFTC Commitments: CME Swiss Franc Futures-Feb 15

Swiss Franc - Chicago Mercantile Exchange
Futures Only Positions As Of 02/12/08 |
==============================================================| Nonreportable
Non-Commercial | Commercial | Total | Positions
==========================|=================|=================|================
Long | Short |Spreads | Long | Short | Long | Short | Long | Short
===============================================================================
(Contracts Of Chf 125,000) Open Interest: 57,989
Commitments
17,550 14,370 11 18,023 35,696 35,584 50,077 22,405 7,912

Changes From 02/05/08 (Change In Open Interest: -6,364)
-5,038 -5,432 0 -1,149 329 -6,187 -5,103 -177 -1,261

Percent Of Open Interest For Each Category Of Traders
30.3 24.8 0.0 31.1 61.6 61.4 86.4 38.6 13.6

Number Of Traders In Each Category (Total Traders: 43)
16 9 1 11 12 28 21

-By Linda Rice; Dow Jones Newswires; 913-322-5173;
csstat@dowjones.com

CFTC Commitments: CME Mexican Peso Futures-Feb 15
Fri, Feb 15 2008, 20:30 GMT
http://www.djnewswires.com/eu
CFTC Commitments: CME Mexican Peso Futures-Feb 15

Mexican Peso - Chicago Mercantile Exchange
Futures Only Positions As Of 02/12/08 |
==============================================================| Nonreportable
Non-Commercial | Commercial | Total | Positions
==========================|=================|=================|================
Long | Short |Spreads | Long | Short | Long | Short | Long | Short
===============================================================================
(Contracts Of Mxn 500,000) Open Interest: 152,013
Commitments
111,054 5,032 653 34,044 144,244 145,751 149,929 6,262 2,084

Changes From 02/05/08 (Change In Open Interest: 30,897)
31,932 -2,035 -380 948 34,974 32,500 32,559 -1,603 -1,662

Percent Of Open Interest For Each Category Of Traders
73.1 3.3 0.4 22.4 94.9 95.9 98.6 4.1 1.4

Number Of Traders In Each Category (Total Traders: 107)
64 16 3 10 20 77 37

-By Linda Rice; Dow Jones Newswires; 913-322-5173;
csstat@dowjones.com

CFTC Commitments: CME British Pound Futures-Feb 15
Fri, Feb 15 2008, 20:30 GMT
http://www.djnewswires.com/eu
CFTC Commitments: CME British Pound Futures-Feb 15

British Pound Sterling - Chicago Mercantile Exchange
Futures Only Positions As Of 02/12/08 |
==============================================================| Nonreportable
Non-Commercial | Commercial | Total | Positions
==========================|=================|=================|================
Long | Short |Spreads | Long | Short | Long | Short | Long | Short
===============================================================================
(Contracts Of Gbp 62,500) Open Interest: 96,936
Commitments
26,593 40,526 1,546 51,048 28,609 79,187 70,681 17,749 26,255

Changes From 02/05/08 (Change In Open Interest: 3,320)
-4,164 1,960 -242 6,668 -430 2,262 1,288 1,058 2,032

Percent Of Open Interest For Each Category Of Traders
27.4 41.8 1.6 52.7 29.5 81.7 72.9 18.3 27.1

Number Of Traders In Each Category (Total Traders: 77)
15 32 4 22 17 39 51

-By Linda Rice; Dow Jones Newswires; 913-322-5173;
csstat@dowjones.com

CFTC Commitments: CME Japanese Yen Futures-Feb 15
Fri, Feb 15 2008, 20:30 GMT
http://www.djnewswires.com/eu
CFTC Commitments: CME Japanese Yen Futures-Feb 15

Japanese Yen - Chicago Mercantile Exchange
Futures Only Positions As Of 02/12/08 |
==============================================================| Nonreportable
Non-Commercial | Commercial | Total | Positions
==========================|=================|=================|================
Long | Short |Spreads | Long | Short | Long | Short | Long | Short
===============================================================================
(Contracts Of Jpy 12,500,000) Open Interest: 231,216
Commitments
73,955 30,484 1,091 120,344 175,817 195,390 207,392 35,826 23,824

Changes From 02/05/08 (Change In Open Interest: 5,926)
-9,785 1,434 -226 15,465 654 5,454 1,862 472 4,064

Percent Of Open Interest For Each Category Of Traders
32.0 13.2 0.5 52.0 76.0 84.5 89.7 15.5 10.3

Number Of Traders In Each Category (Total Traders: 111)
39 28 10 28 27 72 60

-By Linda Rice; Dow Jones Newswires; 913-322-5173;
csstat@dowjones.com

CFTC Commitments: CME Euro FX Futures-Feb 15
Fri, Feb 15 2008, 20:30 GMT
http://www.djnewswires.com/eu
CFTC Commitments: CME Euro FX Futures-Feb 15

Euro Fx - Chicago Mercantile Exchange
Futures Only Positions As Of 02/12/08 |
==============================================================| Nonreportable
Non-Commercial | Commercial | Total | Positions
==========================|=================|=================|================
Long | Short |Spreads | Long | Short | Long | Short | Long | Short
===============================================================================
(Contracts Of Eur 125,000) Open Interest: 207,601
Commitments
55,016 44,721 2,025 103,545 118,882 160,586 165,628 47,015 41,973

Changes From 02/05/08 (Change In Open Interest: 8,107)
-5,090 -2,821 -88 17,032 9,503 11,854 6,594 -3,747 1,513

Percent Of Open Interest For Each Category Of Traders
26.5 21.5 1.0 49.9 57.3 77.4 79.8 22.6 20.2

Number Of Traders In Each Category (Total Traders: 124)
37 42 10 31 30 74 76

-By Linda Rice; Dow Jones Newswires; 913-322-5173;
csstat@dowjones.com

FOREXFC FOREX NEWS COLLECTIONS

2008-02-15T07:13:00.000-08:00

FOREXFC FOREX NEWS COLLECTIONS

2008-02-15T05:37:00.000-08:00

CME/IMM Financials Volume And Open Interest - Feb 15
Fri, Feb 15 2008, 13:17 GMT
http://www.djnewswires.com/eu
CME/IMM Financials Volume And Open Interest - Feb 15
Data for previous business day.
Volume Open Int Change
Libor One Month
QEM G8 565 18,147 -152
QEM H8 621 11,509 198
QEM J8 1 7,895 -1
QEM K8 0 3,983 0
QEM M8 0 1,981 0
QEM N8 0 1,390 0
QEM Q8 0 1,102 0
QEM U8 0 740 0
QEM V8 0 210 0
QEM X8 0 200 0
QEM Z8 0 120 0
Total 1,187 47,277 45
Eurodollar 3 Month Pit Only
QED G8 14,565 110,862 -6,540
QED H8 271,682 1,780,370 -40,546
QED J8 373 4,316 300
QED K8 0 405 0
QED M8 399,276 1,872,969 21,574
QED U8 569,966 1,419,043 -31,885
QED Z8 461,112 1,411,361 -15,680
QED H9 452,290 1,070,668 -10,629
QED M9 339,656 818,231 -2,106
QED U9 298,124 753,346 -1,674
QED Z9 230,642 525,337 19,912
QED H0 94,550 278,403 9,505
QED M0 95,029 259,005 -8,521
QED U0 49,336 204,497 3,223
QED Z0 32,210 157,354 1,191
QED H1 18,751 103,487 556
QED M1 10,164 107,117 -63
QED U1 8,837 71,405 640
QED Z1 8,834 72,348 626
QED H2 5,993 61,010 -631
QED M2 5,061 59,825 1,034
QED U2 4,721 46,494 -996
QED Z2 3,749 27,253 -1,070
QED H3 1,195 13,494 964
QED M3 254 8,567 177
QED U3 525 8,980 -250
QED Z3 383 9,945 147
QED H4 209 13,377 -203
QED M4 7 7,431 1
QED U4 7 3,902 4
QED Z4 108 3,256 -20
QED H5 3 1,377 3
QED M5 3 802 3
QED U5 3 2,904 3
QED Z5 3 1,190 3
QED H6 3 2,180 3
QED M6 3 1,933 0
QED U6 3 958 3
QED Z6 3 1,142 0
QED H7 3 1,044 0
QED M7 3 473 0
QED U7 3 315 0
QED Z7 3 239 0
Total 3,377,665 11,298,615 -60,962
Euroyen 3 Month Libor
EL H8 0 0 0
EL M8 0 0 0
EL U8 0 0 0
EL Z8 0 0 0
EL H9 0 0 0
Total 0 0 0
Euroyen
EY H8 16 11,215 13
EY M8 205 7,474 23
EY U8 200 6,784 196
EY Z8 100 2,399 100
EY H9 9 1,266 9
EY M9 9 165 9
EY U9 0 350 0
Total 539 29,653 350
Nikkei 225 Stock Average Index
NK H8 15,605 81,801 -1,695
NK M8 1 17 1
NK U8 0 13 0
NK Z8 0 1 0
Total 15,606 81,832 -1,694

-By Rose Ridinger; Dow Jones Newswires; 913-322-5174;
csstat@dowjones.com

EU's Almunia: Eurozone 4Q GDP Slows As Expected
Fri, Feb 15 2008, 13:12 GMT
http://www.djnewswires.com/eu
EU's Almunia: Eurozone 4Q GDP Slows As Expected

BRUSSELS (Dow Jones)--Euro-zone gross domestic product is slowing as expected, the European Union Commissioner for Monetary Affairs Joaquin Almunia said Friday.

Euro-zone economic growth halved in the fourth quarter, in the three months to December, to 0.4%, from the 0.8% growth rate recorded in the third quarter, data from European statistics agency Eurostat showed Thursday.

Almunia said these numbers are mostly in line with the commission's expectations.

"You can't ignore the deceleration of growth," he told a conference at the Belgian National Bank.

The commission will publish its own economic forecasts Feb. 21.

-By Adam Cohen, Dow Jones Newswires; +32-2-741-1486; adam.cohen@dowjones.com

(END) Dow Jones Newswires

February 15, 2008 08:12 ET (13:12 GMT)

DATA SNAP: Polish Jan CPI Rises To 4.3%, Above 4.1% Forecast
Fri, Feb 15 2008, 13:11 GMT
http://www.djnewswires.com/eu
DATA SNAP: Polish Jan CPI Rises To 4.3%, Above 4.1% Forecast

By Malgorzata Halaba

Of DOW JONES NEWSWIRES

=======================================================
January Consumer Price Index ! !
Jan Dec ! Consensus: YY +4.1% !
Month +0.8% +0.3% ! !
Year +4.3% +4.0% ! Actual: YY +4.3% !
=======================================================

WARSAW (Dow Jones)--Poland's annual inflation rate rose more than expected to 4.3% in January from 4.0% in December, according to figures released Friday by the Central Statistical Office, or GUS.

On the month, January consumer prices rose 0.8%, compared with a 0.3% rise in December, GUS said. The figures are preliminary.

The headline annual inflation rate was above the average forecast of 4.1% in a Dow Jones Newswires survey of 10 bank economists and a 4.0% preliminary estimate from the finance ministry. It remains well above the upper limit of the central bank's 1.5%-3.5% tolerance band.

The result confirms that global food and commodity prices continue to lift Poland's inflation rate, already pressured by rising wages and demand, increasing the likelihood of another central bank rate hike in the first quarter.

Statistical Office Web site: http://www.stat.gov.pl
-By Malgorzata Halaba, Dow Jones Newswires; +48-22-622-2766; malgorzata.halaba@dowjones.com

(END) Dow Jones Newswires

February 15, 2008 08:11 ET (13:11 GMT)

Metals - Aluminium builds on gains as supply issues threaten to tighten market
Fri, Feb 15 2008, 13:07 GMT
http://www.afxnews.com
LONDON (Thomson Financial) - Aluminium extended gains in early afternoon trade amid fears supply constraints in South Africa and China could cause stocks to tighten.
Aluminium closed 4.5 pct firmer yesterday, the Commonwealth Bank of Australia said, amid reports that South African power utility Eskom, which has been plagued with generating problems in recent months, was considering buying back electricity from three aluminium smelters in southern Africa.
Eskom also said power cuts to mines and smelters would last until 2012, when new electricity stations come on line, further crimping supply.
South Africa is the world's eighth largest producer of aluminium. Mines are currently receiving only around 90 pct of their usual electricity supply, and generating problems are likely to continue in the medium term.
Meanwhile production outages linked to bad weather in the world's largest aluminium producer, China, will further pressure supply. Analysts said a power outage there caused by snow could lead to a loss of 650,000 tonnes of aluminium output.
Analysts at Barclays Capital said they are raising their one-month price target for aluminium to 3,000 usd a tonne.
"As well as losses in China, there have also been production reductions in Latin America and Tajikistan, and South African losses could be much higher than we had previously expected," they said.
"If industrial users are asked to maintain the 10 pct reduction in electricity demand for the rest of 2008, this alone will amount to quite a sizeable fall in supply of around 140,000 tonnes."
At 12.46 pm, LME aluminium for three-month delivery was trading at 2,850 usd against 2,806 usd yesterday.
Copper was also higher, with prices buoyed by a further decline in LME-monitored stockpiles of the metal this morning and as Chinese imports data released overnight indicated demand from the Asian giant remains buoyant.
LME-monitored copper stocks declined a further 4,000 tonnes this morning to 150,650 tonnes, their lowest level since last October. Copper inventories have dropped by 48,000 tonnes so far this year.
The news helped cancel out a hefty rise in inventories monitored by the Shanghai Futures Exchange, which were up 54 pct over the last fortnight according to figures released overnight. The rise is typical for the time of year, analysts said.
Elsewhere the national customs service said Chinese imports of copper and copper products rose 6 pct in January from December to 239,000 tonnes.
"China is still consuming and importing healthy amounts of copper," said UBS analyst Robin Bhar. "This shows China has an appetite for copper and that is always going to lend some support (to prices)."
Copper for three-month delivery was up at 7,818 usd a tonne against 7,690 usd at the close yesterday.
Among other metals, lead climbed to 3,040 usd against 3,015 usd, nickel was steady at 27,900 usd, and zinc climbed up to 2,365 usd from 2,352 usd.
Tin was the only metal to buck the upward trend, falling to 16,800 usd a tonne from 17,050 usd.
jan.harvey@thomson.com
har/lht//cmr

Forex - Dollar remains under pressure ahead of US data
Fri, Feb 15 2008, 13:00 GMT
http://www.afxnews.com
LONDON (Thomson Financial) - The dollar was lower against the euro and the yen ahead of a raft of US data on industrial production, consumer sentiment and import prices.
The greenback's falls were triggered by markets' gloomy interpretation of US Federal Reserve chairman Ben Bernanke's assessment of the US economy yesterday.
Bernanke told the Senate Budget Committee there were strong "downside risks" to US economic growth and the Fed was ready to respond as necessary.
While Bernanke also stressed the central bank was determined to prevent inflation spiraling out of control and that economic growth should recover later in the year, markets leapt on his view that growth is set to slide in the near-term.
This confirmed expectations US borrowing costs will fall by 50 basis points when the Fed next meets to set rates in March.
"Equity markets, perhaps nervous that they had managed to rise for three consecutive days, chose to focus on the Chairmans downbeat view on growth prospects in the near-term and the expressed downside risks to the base case thereafter," said Daragh Maher, currency strategist at Calyon.
Industrial production figures out this afternoon are expected to show just a modest increase in output as the decline in the manufacturing sector continues, while the University of Michigan consumer sentiment survey is set to show confidence remains fragile.
"On the face of it, none of these releases should have a big impact on rate expectations, but with the market drifting into a holiday weekend in the US, there might be scope for amplified reactions in a thin market," Maher said.
Analysts expect movement in equity markets and its subsequent impact on risk aversion is still likely to remain the key driver of the currency markets over the coming days.
Equity markets have enjoyed a relatively strong week, which has led to a pick up in the carry trades -- a risky strategy where investors sell low-yielding currencies such as the yen to invest in higher yielding ones elsewhere.
This meant the Japanese currency and dollar -- both regarded as safe haven currencies have fallen over the past week, but analysts warn this trend could easily reverse.
"Risk aversion could resurge at any moment in the case of bad news out of the financial sector, which would limit the upside potential in the euro against the dollar, and support the yen," said Antje Praefcke at Commerzbank.
European equity markets have all edged lower this morning, prompting a recovery in the yen after slipping earlier following the Bank of Japan's widely-expected decision to keep interest rates on hold.
In the subsequent press conference BoJ governor Toshihiko Fukui said there was heightened global uncertainty in financial markets and expressed concerns over the difficulties faced by small companies in Japan as profits are squeezed due to rising input costs.
"Governor Fukui's comments suggest that the BoJ are not overly confident that the strength of real GDP reported in the fourth quarter will be sustained into 2008," said Derek Halpenny, currency strategist at Bank of Tokyo-Mitsubishi.
Meanwhile, the pound was sharply lower against the dollar and the euro, apparently driven by fears UK banks may have to announce further writedowns in the coming months.
Reports that Swiss Bank UBS may announce further losses of around 18 bln usd due to write-downs on assets known as collateralized debt obligations (CDO) has fuelled fears its UK counterparts could follow suit.
"British banks are known for their CDO exposure, putting bank shares on the equity market under pressure -- sterling has followed straight after them," BNP Paribas analysts said.
London 1235 GMT London 0925 GMT
US dollar
yen 107.75 down from 108.25
sfr 1.0944 down from 1.0976
Euro
usd 1.4672 up from 1.4653
yen 158.11 down from 158.63
sfr 1.6058 down from 1.6087
stg 0.7475 up from 0.7457
Sterling
usd 1.9617 down from 1.9644
yen 211.42 down from 212.61
sfr 2.1474 down from 2.1560
Australian dollar
usd 0.9060 up from 0.9055
stg 0.4616 up from 0.4607
yen 97.70 down from 98.00
rachel.armstrong@thomson.com
rar/am

CME Currencies Volume/Open Interest - Feb 15
Fri, Feb 15 2008, 12:59 GMT
http://www.djnewswires.com/eu
CME Currencies Volume/Open Interest - Feb 15
Data for previous business day.
Volume Open Int Change
British Pound Pit CME
BP H8 58,746 89,333 -4,335
BP M8 101 1,636 -37
BP U8 0 22 0
BP Z8 7 58 0
BP H9 0 3 0
BP M9 1 2 1
Total 58,855 91,054 -4,371
Canadian Dollar Pit CME
CD H8 45,797 91,887 454
CD M8 458 6,216 252
CD U8 10 1,620 1
CD Z8 3 908 2
CD H9 51 328 21
CD M9 0 17 0
Total 46,319 100,976 730
E-Mini Euro CME
ZE H8 1,379 1,580 6
ZE M8 23 262 8
Total 1,402 1,842 14
Euro FX Pit CME
EC H8 164,287 198,435 2,017
EC M8 488 6,829 10
EC U8 0 382 0
EC Z8 2 264 0
EC H9 0 17 0
Total 164,777 205,927 2,027
E-Mini Japense Yen CME
ZJ H8 69 225 -11
ZJ M8 4 11 0
Total 73 236 -11
Japanese Yen Pit CME
JY H8 97,792 201,685 -1,923
JY M8 45 28,180 7
JY U8 0 532 0
JY Z8 0 38 0
JY H9 0 14 0
JY M9 0 11 0
Total 97,837 230,460 -1,916
Mexican Peso Pit CME
ME G8 26 3 -23
ME H8 16,460 137,133 3,638
ME J8 0 139 0
ME K8 0 3 0
ME M8 2 24,228 0
ME U8 0 252 0
ME Z8 0 344 0
ME H9 0 35 0
ME M9 0 9 0
Total 16,488 162,146 3,615
Swiss Franc Pit CME
SF H8 55,987 58,178 -4
SF M8 32 389 8
SF U8 0 34 0
SF Z8 0 37 0
SF H9 0 4 0
Total 56,019 58,642 4
Australian Dollar Pit CME
AD H8 41,765 86,999 2,788
AD M8 143 1,649 27
AD U8 0 80 0
AD Z8 2 144 1
AD H9 0 27 0
AD M9 0 1 0
Total 41,910 88,900 2,816
Brazilian Real Pit CME
BR H8 219 8,632 210
BR Z8 0 10 0
Total 219 8,642 210
New Zealand Dollar Pit CME
NE H8 1,598 24,482 -187
NE M8 2 61 -1
Total 1,600 24,543 -188
Russian Ruble Pit CME
QRU H8 7 3,934 -6
QRU M8 0 3,091 0
QRU U8 0 7,375 0
QRU Z8 0 987 0
QRU H9 0 410 0
Total 7 15,797 -6
South African Rand Pit CME
RA H8 161 4,673 115
RA M8 40 6 -16
Total 201 4,679 99
$ Index
UX H8 0 0 0
UX M8 0 0 0
UX U8 0 0 0
UX Z8 0 0 0
UX H9 0 0 0
UX M9 0 0 0
Total 0 0 0

-By Rose Ridinger; Dow Jones Newswires; 913-322-5174;
csstat@dowjones.com

(END) Dow Jones Newswires

February 15, 2008 07:59 ET (12:59 GMT)

India spot sugar falls further on abundant supply
Fri, Feb 15 2008, 12:53 GMT
http://www.afxnews.com
MUMBAI (Thomson Financial) - Indian sugar prices eased further for the second consecutive week to Friday, weighed by higher supply of the commodity in February.
The country's food ministry has raised the supply quota for the month of February to 1.4 mln metric tonnes from the earlier 1.3 mln in anticipation of the higher demand due to upcoming Hindu festivals.
In India, the central government decides the quantity sugar mills can sell in the domestic market at the start of each month.
analysts expect prices to firm up in the near term on an expected drop in the country's sugar produce.
India's agriculture minister Sharad Pawar had said recently sugar production in the crop year 2007-08 is expected to come down to 26 mln tonnes from the current 28 mln due to low yields in some states.
Analysts expect the country's export demand to be about 3 mln tonnes in the marketing year that started in October 2007 compared with 1.5 mln tonnes in the year earlier period.
In Mumbai's Vashi market, M-30 sugar was quoted at 1,415-1,515 rupees per quintal, compared with 1,425-1,525 rupees a week earlier. One quintal is equivalent to 100 kilograms. Sugar of the S-30 variety was quoted at 1,377-1,430 rupees per quintal, compared with 1,390-1,436.
tfn.newsdesk@thomson.com
sim/jro/am

Foreign Exchanges - Continental Forward Rates
Fri, Feb 15 2008, 12:47 GMT
http://www.afxnews.com
LONDON (Thomson Financial) -
Foreign Exchanges - Continental Forward Rates
Euro
1 Month 06.00 - 09.00 dis
2 Months 14.00 - 18.00 dis
3 Months 21.00 - 25.00 dis
6 Months 43.00 - 48.00 dis
12 Months 87.00 - 97.00 dis
Denmark
1 Month 16.00 - 02.00 prm
3 Months 40.00 - 17.00 prm
Norway
1 Month 06.00 - 10.00 prm
3 Months 02.00 - 19.00 prm
Sweden
1 Month 16.00 - 04.00 prm
3 Months 37.00 - 20.00 prm
Japan
1 Month 88.00 - 75.00 prm
3 Months 253.00 - 233.00 prm
Switzerland
1 Month 53.00 - 40.00 prm
3 Months 161.00 - 135.00 prm
Canada
1 Month 28.00 - 20.00 prm
3 Months 90.00 - 72.00 prm
TFN.newsdesk@thomson.com
tda/jro

Dollar Forward Rates
Fri, Feb 15 2008, 12:43 GMT
http://www.afxnews.com
LONDON (Thomson Financial) -
New York
1 mth 34.79 - 34.04 prm
3 mths 119.55 - 118.55 prm
6 mths 248.70 - 247.20 prm
12 mths 483.50 - 480.50 prm
TFN.newsdesk@thomson.com
tda/jro

FOREXFC FOREX NEWS COLLECTIONS

2008-02-15T05:30:00.000-08:00

Afternoon Interbank Intercurrency
Fri, Feb 15 2008, 12:40 GMT
http://www.afxnews.com
LONDON (Thomson Financial) -
(Rates supplied by Barclays Intl)
CANADA
TOM/NEXT 4.00 - 4.10
7 DAY 4.00 - 4.10
1 MTH 4.00 - 4.10
3 MTHS 3.80 - 3.90
6 MTHS 3.75 - 3.85
12 MTHS 3.65 - 3.75
JAPAN
TOM/NEXT 0.50 - 0.60
7 DAY 0.51 - 0.56
1 MTH 0.58 - 0.63
3 MTHS 0.85 - 0.90
6 MTHS 0.89 - 0.94
12 MTHS 1.00 - 1.05
STERLING
TOM/NEXT 5.27 - 5.32
7 DAY 5.29 - 5.34
1 MTH 5.47 - 5.55
3 MTHS 5.57 - 5.65
6 MTHS 5.52 - 5.60
12 MTHS 5.36 - 5.46
EURO
TOM/NEXT 3.98 - 4.02
7 DAY 4.05 - 4.09
1 MTH 4.13 - 4.18
3 MTHS 4.30 - 4.36
6 MTHS 4.29 - 4.35
12 MTHS 4.29 - 4.35
TFN.newsdesk@thomson.com

ECB's Liikanen: Central Bank Independence "Critical"
Fri, Feb 15 2008, 12:39 GMT
http://www.djnewswires.com/eu
ECB's Liikanen: Central Bank Independence "Critical"

BRUSSELS -(Dow Jones)- European Central Bank Governing Council Member Erkki Liikanen Friday defended the central bank's focus on inflation saying stable prices are needed to ensure economic growth.

The ECB has held its key rate steady at 4% since June despite slowing economic growth. The U.S. Federal Reserve by contrast has slashed interest rates to stave off a looming recession.

"If we want to guarantee good economic growth, price stability is a prerequisite," Liikanen said.

The ECB over the past year has been criticized by some European Union governments, particularly France, for keeping interest rates too high.

Liikanen said central bank independence is "critical" to sound monetary policies.

-By Adam Cohen, Dow Jones Newswires; +32 2 741 1486; adam.cohen@dowjones.com

(END) Dow Jones Newswires

2nd UPDATE: Greek PM Outlines Pension Reform Plan
Fri, Feb 15 2008, 12:36 GMT
http://www.djnewswires.com/eu
2nd UPDATE: Greek PM Outlines Pension Reform Plan
(Adds analyst comment.)

ATHENS -(Dow Jones)- Greek Prime Minister Costas Karamanlis Friday outlined the broad direction of his long-awaited pension reform proposals, giving few details but warning that the system could collapse within the next few years if no action is taken.

In a speech to parliament, Karamanlis said that the cost of funding Greece's retirees would double within the next 40 years, consuming the equivalent of 25% of total gross domestic product, up from 12.6% currently.

"The problem isn't that far away, it is immediately in front of us," he said. "The pressure on the pension system increases year by year. And that pressure will become unbearable within the next five to ten years."

In the 2007, roughly one quarter of the government's EUR55 billion budget - or about EUR15 billion - was spent on transfers to the social security system. This year, some EUR18 billion from the budget is earmarked for the pension system.

Greece's center-right New Democracy government was re-elected last September on a reform agenda and has pledged to tackle the problems facing the country's fragmented and deficit-ridden pension system within the first 12 months of its new term.

Just last year, Greece was released from special budgetary supervision from the European Union after lowering its deficit to below the E.U. limit of 3% of gross domestic product. But barring major pension reform and further budgetary consolidation, Greece's ratio of debt to gross domestic product, already the second highest in the E.U. behind Italy's, is set to balloon.

In his remarks, Karamanlis reaffirmed his intention to merge the country's 155 pension and provident funds into just a handful, while also the raising retirement age for select workers, such as working mothers.

In a bid to shore up the pension system for future generations, Karamanlis also announced the creation of a new long-term fund that would pool revenue from different sources to help pay for younger workers after 2019.

That new fund would draw on a mixture of revenue streams, including 10% of annual proceeds from future state privatizations; 4% of annual revenue collected from value-added taxes; and 10% of income earned by existing pension funds benefitting from earmarked taxes.

Karamanlis also said that the system of early retirement for arduous or hazardous occupations needed to be addressed, but offered few details.

His remarks come after vigorous union opposition to the reforms, including two nationwide general strikes in as many months.

It's widely expected that the government will submit pension reform legislation sometime next week.

Twice in the recent past, Greece has reformed its pension system - in 1992 under the previous New Democracy government, and in 2002 under the Socialists. Both reforms are credited with extending the viability of the system, but stopped short of radical reform.

"It's a fact that each government adds something to the social security system. Whether this reform will be a major step forward or not, remains to be seen," said Dimitris Maroulis, an economist at Alpha Bank. "We really have to know a bit more detail before we can understand the impact."

-By Alkman Granitsas, Dow Jones Newswires; +30 210 331 2881; alkman.granitsas@dowjones.com

(END) Dow Jones Newswires

Metals - Platinum spikes to fresh all-time high on South African supply woes
Fri, Feb 15 2008, 12:24 GMT
http://www.afxnews.com
LONDON (Thomson Financial) - Platinum spiked to a fresh all-time high in midday trade as the prospect of further supply outages in major producer South Africa spooked investors.
The white metal rose to a record 2,055 usd an ounce before falling back to trade at 2,046 usd an ounce at 12.04 pm, against 2,002 usd in late New York trade yesterday.
Platinum has hit a series of new highs in recent days as supply constraints in South Africa, the source of almost 80 pct of world supply of the metal, threatened to cut into inventories.
"Power shortages have led to producers sharply scaling back production forecasts and further widen the estimated market deficit, and furthermore the market is also faced with historically low levels of stock," Barclays Capital analysts said.
South African state power company Eskom, whose call to reduce power usage shut a string of mines earlier this year, said yesterday it will be operating at only 90 pct capacity until 2012, potentially crimping long-term mine output.
Eskom also offered to buy back electricity from smelters, reports said, fuelling fears the crisis could prove more protracted than initially thought.
With demand for the metal, which is used extensively in carmaking, almost price insensitive in the short term, any supply shortfall could yet push the metal substantially higher, analysts said.
Meanwhile, gold was firmer after the US dollar weakened overnight following comments from US Federal Reserve chairman Ben Bernanke that suggested a further cut in US interest rates could be in the offing.
The greenback softened further against the euro this morning after the release of euro zone trade data, further boosting the precious metal's appeal as an alternative investment.
A softer dollar also makes gold, which is denominated in the US currency, cheaper for holders of other currencies.
"The return of the weak dollar/strong oil scenario should prove support for gold in the coming sessions," TheBullionDesk.com analyst James Moore said.
Gold was trading at 910.20 usd an ounce against 907.30 usd in late New York trade yesterday.
Among other precious metals, palladium was steady at 433 usd against 435 usd an ounce, while silver rose to 17.35 usd against 17.23 usd.
jan.harvey@thomson.com
har/am

OPEC cuts 2008 oil demand growth forecast, flags US economic slowdown
Fri, Feb 15 2008, 12:20 GMT
http://www.afxnews.com
LONDON (Thomson Financial) - Oil cartel OPEC cut its oil demand growth forecast for 2008 and said while its demand growth projections are lower than assessments from other agencies, it cannot rule out the potential for further downward revisions.
"A sharp economic slowdown, especially in the US, may further undermine demand growth in the coming months," said the cartel in its monthly report. It added current OPEC output near 32 mln bpd could help ease market fundamentals.
For 2008, OPEC sees oil demand growing by 1.2 mln bpd, a downward revision of 0.08 mln bpd from the last monthly assessment. Its forecast is sharply below the International Energy Agency's call for growth of 1.67 mln bpd this year.
OPEC is aware of this disparity, but said in its view, risks to the world economy have increased considerably since the fourth quarter of 2007 on continued turbulence in financial markets.
In addition, there is growing evidence of a slowdown in the US economy, which has fuelled fears of an outright US recession that could have potential repercussions for the rest of the world.
"These concerns have affected equity markets worldwide and to a lesser extent the commodity and oil markets," the cartel said. It added, however, it is as yet unclear to what extent growth in developing countries will be crimped.
While initial estimates indicate countries like China and India will still grow at healthy levels this year, there is a risk tighter monetary policy will restrict growth.
Turning to supply, OPEC said although it has trimmed its forecast for supply growth from non-OPEC countries, it still believes demand for its crude will fall this year.
Non-OPEC supply is seen growing by 1.1 mln bpd this year, a downward revision of 0.01 mln bpd from the last estimate, however, OPEC thinks it will have to produce less crude this year over last.
"The demand for OPEC crude in 2008 is expected to average 31.53 mln bpd, a decline of around 375,000 bpd compared with 2007" when oil demand growth averaged an estimated 1.2 mln bpd.
Moreoever, it believes its current output of about 32 mln bpd should help further ease market fundamentals, resulting in increases in global inventories over the coming quarters.
OPEC is scheduled to memt on March 5 to set output policy. At its last meeting in February, the cartel opted to keep output levels steady amid concerns over falling demand and economic instability.
maytaal.angel@thomson.com
ma/am

Russia ups car production 4.9 pct in Jan

2008-02-15T05:29:00.000-08:00

Fri, Feb 15 2008, 12:16 GMT
http://www.afxnews.com

MOSCOW (Thomson Financial) - Russia increased its car production by 4.9 pct year-on-year in January to 90,000 units, the Federal State Statistics Service said.

Truck production fell, by 4.3 pct to 17,700 units, and bus production also fell, by 12.2 pct, to 4,300 units.

tf.TFN-Europe_newsdesk@thomson.com

ra/rw

ForexFc

FOREXFC FOREX NEWS COLLECTIONS

2008-02-15T05:26:00.000-08:00

ICE US Equity & Currency Closing Estimated Volumes For Feb 14
Fri, Feb 15 2008, 12:00 GMT
http://www.djnewswires.com/eu
ICE US Equity & Currency Closing Estimated Volumes For Feb 14
Estimated Volume Report for 7-Feb-2008

Floor Electronic Call Put Total
Commodity Futures Futures Options Options Options
FINEX
AUS$/US $ 0 0 0 0 0
Aus. Dollar - N.Z. Dollar 14 0 0 0 0
Australian $-Canadian $ 111 0 0 0 0
U.S. Dollar - Aus. Dollar 0 0 0 0 0
Brazilian Real-US $ 0 0 0 0 0
Colombian peso-US Dollar 0 0 0 0 0
U.S. DOLLAR INDEX 716 5050 102 43 145
Euro Index 0 0 0 0 0
EURO-Japanese Yen 361 2 0 0 0
EURO - US $ 35 656 0 0 0
Euro-Canadian Dollar 83 16 0 0 0
EURO - US $ 0 0 0 0 0
EURO - CZECH KORUNA 14 0 0 0 0
Euro - Sterling 185 86 0 0 0
Pound Sterling-N Z.Dollar 0 0 0 0 0
EURO - HUNGARIAN FORINT 0 30 0 0 0
Canadian $-Japanese Yen 37 3 0 0 0
Swedish Krona-Japanese Yen 0 0 0 0 0
U.S.$-Swedish Krona 86 0 0 0 0
US dollar/Swedish Krona 0 16 0 0 0
Norway Krone -Japanese Yen 0 0 0 0 0
Small US$-Swiss Franc 65 71 0 0 0
Sm.British Pound-US$ 0 193 0 0 0
Norwegian/Swedish 0 0 0 0 0
U.S.$-Norwegian krone 83 0 0 0 0
US dollar/Norwegian Krone 0 11 0 0 0
Euro-Norwegian Krone 21 0 0 0 0
POUND STERLING-CANADIAN $ 80 0 0 0 0
POUND-NORWEGIAN KRONE 0 0 0 0 0
Pound Sterling-Sw. Krona 0 0 0 0 0
Pound Sterling-S.A. Rand 0 0 0 0 0
Pound-Australian $ 21 0 0 0 0
Euro-Australian Dollar 33 1 0 0 0
Euro-SWEDISH KRONA 61 15 0 0 0
Euro - Swiss Franc 1092 82 0 0 0
Small US$-Japanese Yen 79 114 0 0 0
BRITISH POUND-SWISS FRANC 53 0 0 0 0
Small US $-Canadian $ 0 7 0 0 0
BRITISH POUND-JAPANESE YEN 157 44 0 0 0
US $-HUNGARIAN FORINT 395 0 0 0 0
US $-CZECH KORUNA 9 0 0 0 0
US dollar/Czech Koruna 0 0 0 0 0
US $/Hungarian Forint 0 30 0 0 0
Australian $-Japanese Yen 95 0 0 0 0
U.S.Dollar - Canadian 0 0 0 0 0
U.S.Dollar - Swiss Franc 0 0 0 0 0
U.S.Dollar - British Pound 0 0 0 0 0
BRITISH STERLING/YEN 0 0 0 0 0
U.S.Dollar - Japanese Yen 0 0 0 0 0
EURO-South African Rand 0 0 0 0 0
NZ$ / US$ 0 0 0 0 0
New Zealand $-Japanese Yen 0 0 0 0 0
U.S. Dollar-S.African Rand 466 8 0 0 0
U.S. Dollar - N. Z. Dollar 0 77 0 0 0
SWISS FRANC-Japanese Yen 219 12 0 0 0

INDEXES
CONTINUOUS COMMODITY INDEX 18 0 0 0 0
RJ CRB INDEX 0 0 0 0 0
Russell 1000 Growth Index 0 0 0 0 0
Russell 2000 Growth 0 0 0 0 0
Small NYSE Comp Index 0 0 0 0 0
Russell 1000 1 5 0 307 307
Russell 1000 Mini 0 194 0 0 0
Russell 2000 Mini Index 0 290 0 0 0
Russell 3000 0 0 0 0 0
Russell 2000 Index 0 0 0 159 159
Russell 2000 Value 0 0 0 0 0
Russell 1000 Value 0 0 0 0 0
NYSE Comp Index 0 0 0 0 0

-By Linda Rice; Dow Jones Newswires; 913-322-5173;
csstat@dowjones.com

UPDATE: Euro-Zone Trade Balance Dives Into Deficit In Dec
Fri, Feb 15 2008, 11:59 GMT
http://www.djnewswires.com/eu
UPDATE: Euro-Zone Trade Balance Dives Into Deficit In Dec

(Adds details, economist comment)

By Nicholas Winning
Of DOW JONES NEWSWIRES

LONDON (Dow Jones)--The euro zone's foreign trade balance swung into deficit for the first time in 10 months in December as growth in imports outpaced that of exports, suggesting that the recent strength of the euro is curbing the competitiveness of euro-zone businesses.

The 13 countries that shared the euro at the time posted a non-seasonally adjusted trade deficit of EUR4.2 billion in December, data from the European Union's Eurostat statistics agency showed Friday. That compared with a surplus of EUR2.4 billion in the corresponding month a year earlier and a revised surplus of EUR3.0 billion in November.

The last time the trade balance was in deficit was in February last year, Eurostat said. Nevertheless, the euro zone posted a trade surplus of EUR28.3 billion over the whole of 2007, compared with a deficit of EUR9.3 billion in 2006.

The market was expecting a surplus of EUR0.35 billion in December, according to a Dow Jones Newswires survey of economists last week. Eurostat revised November's surplus up from EUR2.6 billion.

"It fits a little bit into the picture of slowing momentum in the euro zone, but I wouldn't over-interpret non-seasonally adjusted data," said Holger Sandte, Chief European economist at WestLB.

Martin van Vliet, a senior economist at ING, said the contribution from net trade would probably remain negative during the first half of this year.

"Indeed, the impact of the strong euro has yet to be fully felt and demand in key export markets such as the U.K. and the U.S. is set to weaken further," he said in a note.

The data showed euro-zone exports were flat on the year in December at EUR116.6 billion, while imports grew 6% on the year to EUR120.9 billion. Trade within the euro zone grew 1% on the year to EUR111.8 billion.

In the period from January to November, the euro-zone's trade deficit with China widened to EUR101.5 billion from EUR82.6 billion in the corresponding period of 2006, after a 19% increase in imports.

Some of the euro zone's leading exporters and business groups say the strength of the single currency relative to the dollar and the Chinese yuan is harming their ability to compete globally, since it makes exports from the euro zone more expensive.

The euro has appreciated about 12% against the dollar over the past year, with one euro currently worth just over $1.40.

European Union officials have repeatedly said that foreign exchange rates should reflect economic fundamentals, hinting that they'd like to see these currencies appreciate more rapidly against the euro.

The data showed the surplus with the U.K. between January and November widened to EUR58.4 billion from EUR46.5 billion in the corresponding period a year earlier, with support from a 6% rise in exports.

Elsewhere among the euro-zone's main trading partners, the surplus with the U.S. narrowed and the deficit with Japan widened slightly.

The figures showed the January-November deficit for trade in energy products shrank to EUR205.9 billion from EUR226.2 billion in the year-earlier period as the appreciation of the euro made dollar-denominated oil products cheaper.

There was also a notable increase in the surplus for trade in machinery and vehicles to EUR172.0 billion over the 11 months from EUR140.7 billion in the corresponding period in 2006.

The wider E.U. saw its trade deficit widen to EUR17.9 billion in December from EUR10.1 billion in the corresponding month the previous year, although the deficit for the year as a whole shrank to EUR185.7 billion from EUR192.1 billion in 2006.

The following tables show breakdowns of non-seasonally adjusted trade data:

(In EUR billions, minus figure indicates deficit)

Dec Nov Dec '06 %-change
on year
Euro-13 trade balance -4.2 +3.0r +2.4 n/a
Euro-13 imports 120.9 131.6r 114.1 6%
Euro-13 exports 116.6 134.6r 116.5 0%
Intra Euro-13 dispatches 111.8 134.3r 111.0 1%
r=revised

Euro-13 Main Trading Partners (non-seasonally adjusted) for January through November. December data isn't available yet.

Jan-Nov Jan-Nov 2006
balance balance
U.K. +58.4 +46.5
U.S. +60.3 +68.3
China -101.5 -82.6
Russia -26.3 -37.6
Switzerland +13.8 +13.8
Poland +21.3 +16.1
Sweden +3.8 +2.2
Czech Republic +2.0 +2.8
Japan -21.7 -20.4
Turkey +8.1 +8.8

(A minus sign indicates a deficit)

-By Nicholas Winning, Dow Jones Newswires; +44 20 7842 9498; nick.winning@dowjones.com

(END) Dow Jones Newswires

Kremlin Russian President Candidate Outlines Economic Vision - AFP
Fri, Feb 15 2008, 11:55 GMT
http://www.djnewswires.com/eu
Kremlin Russian President Candidate Outlines Economic Vision - AFP

KRASNOYARSK, Russia (AFP)--Kremlin election favorite Dmitry Medvedev called Friday for less state interference in Russia's economy in comments that indicated a liberal shift from the policies of Vladimir Putin.

Outlining his economic program in a speech at a forum in the Siberian city of Krasnoyarsk ahead of a presidential election on March 2, Medvedev also called for an independent judiciary and greater protection of property rights.

"Most of the bureaucrats on boards of directors should not be there," Medvedev said in comments broadcast on the Vesti-24 news channel, referring to the massive state industrial corporations set up under Putin.

"A significant share of the functions carried out by organs of the state should be given over to the private sector" and more effort should be made by the government to protect private property, he added.

Medvedev is Russia's first deputy prime minister and chairman of state-controlled gas monopoly OAO Gazprom (GAZP.RS), which is accused in the West of using energy exports to pressure neighboring ex-Soviet countries.

A former law professor and legal consultant to Russian businesses in the wake of the Soviet collapse, Medvedev is seen as a relative economic liberal, although he is at the core of the Kremlin elite.

Katya Malofeyeva, chief Russia economist at Renaissance Capital, an investment bank in Moscow, said Medvedev's speech had left her with a "positive impression" but she would be waiting for specifics.

"I think that his instincts are still very much liberal. His instincts are for promoting a market economy.... Even though he has very long-term experience with working with large state companies such as Gazprom," Malofeyeva said.

The election next month is seen as a shoo-in for Medvedev. State-controlled national television has given his campaign lavish coverage and he has the support of Russia's political establishment.

Putin himself cannot run for president under the constitution as he has already served two consecutive terms in office but says he would serve as a powerful prime minister under Medvedev.

In Friday's speech, Medvedev also echoed many of the economic aims outlined by Putin, such as the need to move Russia from a dependence on raw materials towards innovation and to create a larger middle class.

"I think these targets are ambitious but, in my view, they are completely realistic," Medvedev said. He said his program as president would be "institutions, infrastructure, innovation and investment."

Large parts of Russia's economy are still languishing after the post-Soviet industrial collapse and the rapidly widening income gap in Russia means the benefits of economic growth have been uneven.

Medvedev said on Friday that corruption remained "the most serious illness affecting our society" and promised to strengthen a judicial system that is still notoriously prone to political influence.

He also said that as president he would ensure the stability of the ruble, price raw materials exports in the national currency and turn Russia into "one of the biggest financial centers in the world."

(END) Dow Jones Newswires

February 15, 2008 06:55 ET (11:55 GMT)

UPDATE: Greek PM Outlines Pension Reform Plan
Fri, Feb 15 2008, 11:51 GMT
http://www.djnewswires.com/eu
UPDATE: Greek PM Outlines Pension Reform Plan
(Adds detail and background.)

ATHENS -(Dow Jones)- Greek Prime Minister Costas Karamanlis Friday outlined the broad direction of his long-awaited pension reform proposals, giving few details but warning that the system could collapse within the next few years if no action is taken.

In a speech to parliament, Karamanlis said that the cost of funding Greece's retirees would double within the next 40 years, consuming the equivalent of 25% of total gross domestic product, up from 12.6% currently.

"The problem isn't that far away, it is immediately in front of us," he said. "The pressure on the pension system increases year by year. And that presure will become unbearable within the next five to ten years."

In the 2007, roughly one quarter of the government's EUR59 billion budget - or about EUR15 billion - was spent on transfers to the social security system.

Greece's center-right New Democracy government was re-elected last September on a reform agenda and has pledged to tackle the problems facing the country's fragmented and deficit-ridden pension system within the first 12 months of its new term.

Just last year, Greece was released from special budgetary supervision from the European Union after lowering its deficit to below the E.U. limit of 3% of gross domestic product. But barring major pension reform and further budgetary consolidation, Greece's ratio of debt to gross domestic product, already the second highest in the E.U. behind Italy's, is set to balloon.

In his remarks, Karamanlis reaffirmed his intention to merge the country's 155 pension and provident funds into just a handful, while also the raising retirement age for select workers, such as women.

In a bid to shore up the pension system for future generations, Karamanlis also announced the creation of a new long-term fund that would pool revenue from different sources to help pay for younger workers after 2019.

That new fund would draw on a mixture of revenue streams, including 10% of annual proceeds from future state privatizations; 4% of annual revenue collected from value-added taxes; and 10% of income earned by existing pension funds benefitting from earmarked taxes.

Karamanlis also said that the system of early retirement for arduous or hazardous occupations needed to be addressed, but offered few details.

His remarks come after vigorous union opposition to the reforms, including two nationwide general strikes in as many months.

It's widely expected that the government will submit pension reform legislation sometime next week.

-By Alkman Granitsas, Dow Jones Newswires; +30 210 331 2881; alkman.granitsas@dowjones.com

(END) Dow Jones Newswires

February 15, 2008 06:51 ET (11:51 GMT)

Singapore govt expects 800 mln sgd budget deficit in yr to March 2009 - UPDATE
Fri, Feb 15 2008, 11:45 GMT
http://www.afxnews.com
SINGAPORE (Thomson Financial) - The government will incur a budget deficit of 800 million Singapore dollars in the fiscal year to March 2009 as it seeks to enhance tax incentives for businesses and help the lower income and elderly consumers cope with rising inflation, Finance Minister Tharman Shanmugaratnam said Friday.
"This year's budget takes place amidst a time of increasing uncertainty in the global economy. Around the world, growth is slowing and inflation is picking up, especially for food prices. It is a concern for us all in Singapore," Tharman said.
To help Singaporeans battle inflation, the government will distribute 1.8 billion dollars in tax rebates and other cash to lower income groups and the elderly, the minister said.
Part of the amount is the 20 percent rebate on personal income taxes the government is distributing this year, capped at 2,000 dollars per taxpayer. The rebate will cost the government 380 million dollars in forgone revenues.
The goverment is also distributing 865 million dollars to Singaporeans aged 60 years old and above in two installments in April and October. An additional 600 million dollars will also be allocated to education and medical subsidies.
Conservative target
Analysts believe the budget is conservative.
"We have not seen how it will help Singaporeans cope with the higher cost of living," said Citigroup economist Kit Wei Zheng.
"The measure may help cushion the pain a little bit from higher inflation but their (government's) basic approach is not to adopt welfare state-type measures," said David Cohen, chief economist of Action Economics.
Cohen said the government has always been conservative for a good reason.
While Singapore's economic growth is expected to slow to 4-6 percent this year from 7.7 percent last year, Cohen said the expected expansion is still robust, supported by strong employment. Singapore's unemployment rate stood at a 10-year low of 1.6 percent in 2007.
No tax cut
Although Singapore is not reducing the personal income tax rate, Kit said he is not ruling out the possibility of reducing the tax rate should economic conditions turn for the worse.
"They want to save more ammunition in case economic conditions worsen. A cut in personal income tax is still a possibility in the future," the economist said.
Analysts had expected the government to reduce the personal income tax rate to 18 percent from 20 percent, in line with the corporate income tax rate, given the substantial surplus achieved in the current fiscal year.
The government expects to achieve a budget suplus of 6.4 billion Singapore dollars in the fiscal year to March 2008, instead of the 700 million dollar deficit originally expected.
"Singapore's personal income tax regime is already one of the most competitive in the world, because our marginal tax rate schedule is highly progressive. We will not be making any further move on personal income tax rates this year," Tharman said.
"But we will continue to watch this and ensure that we are always able to attract and keep talent in Singapore, including those at the top end," he said.
The budget is a step in the right direction, considering its focus on enhancing the competitiveness of Singapore as a place to do business, Kit of Citigroup said.
To encourage high net-worth individuals to park their assets in the city-state, Tharman said the government has decided to abolish estate duties. The move will cost the government some 70 million dollars in forgone revenues a year but should help promote the local wealth management industry.
The government is also increasing tax exemptions for companies conducting research and development activities in Singapore and enhancing incentives for start-up companies.
(1 US dollar = 1.41 Singapore dollars)
jonathan.burgos@thomson.com
jb/nt
-- By Jonathan Burgos --
jb/nt

ForexFC ForexFC ForexFC ForexFC ForexFC ForexFC ForexFC ForexFC ForexFC ForexFC ForexFC ForexFC ForexFC ForexFC ForexFC ForexFC ForexFC ForexFC ForexFC ForexFC

2008-02-14T19:33:00.001-08:00

Japanese government bonds end morning higher as stocks fall on US uncertainty
Fri, Feb 15 2008, 03:14 GMT
http://www.afxnews.com
TOKYO (Thomson Financial) - Japanese government bond prices rose Friday morning as investors switched back to buying fixed-income instruments and selling riskier stocks against a background of renewed uncertainty about the US economic outlook.
Treasury bond prices edged higher overnight and stocks tumbled as Federal Reserve Chairman Ben Bernanke predicted a "sluggish" economy until later in the year.
On Thursday, Japanese government bond prices rose and stocks fell as investors cheered stronger-than-expected gross domestic product data better-than-expected retail sales data from the US.
Investors are awaiting the Bank of Japan's decision later Friday on interest rates, as well as the press conference by the Bank of Japan Governor Toshihiko Fukui which will give further details on the decision.
"Investors are paying more attention to what the BOJ governor might say about economic outlooks than a decision on interest rates, as they have built a consensus projection that the central bank will vote unanimously to keep its monetary policy unchanged," said Akitsugu Bando, strategist at Okasan Securities.
Akihiko Inoue, strategist at Mizuho Investors Securities, also said the BoJ will likely keep rates unchanged, even after Thursday's GDP reading.
Uncertainty about the future course of world financial markets and economies on the back of the continued fallout from the meltdown in the US subprime sector as well as recent interest rate cuts by the US and other central banks are generally expected to keep BoJ from raising super-low interest rates.
The Nikkei 225 index fell 202.52 points, or 1.5 percent, to end morning trade at 13,423.93.
At midday, the yield on the benchmark 10-year bond was at 1.445 percent, down from 1.460 percent on Thursday.
The yield on the 2-year note was down at 0.570 percent from 0.585 percent, while the yield on the 5-year bond fell to 0.910 percent from 0.930 percent.
The yield on the 20-year bond gained to 2.095 percent from 2.100, while the 30-year bond ended the morning session without transactions.
Bond prices move inversely to yields.
The price of the March futures contract for the 10-year bond was up at 137.61 yen from 137.45 yen late Thursday.
(1 US dollar = 107.85 yen)
yumiko.nishitani@thomson.com
Two senior Bank Indonesia officials detained for alleged corruption - report
Fri, Feb 15 2008, 03:12 GMT
http://www.afxnews.com
JAKARTA (Thomson Financial) - The Corruption Eradication Commission (KPK) has detained two senior central bank officials over allegations of misappropriation of Bank Indonesia (BI) funds, the Jakarta Post reported.
BI's director for legal affairs Oey Hoey Tiong and Rusli Simanjuntak, the head of the central bank office in the East Java town of Surabaya were detained, said the deputy chairman of the commission Chandra M Hamzah.
The anti-graft body also questioned Supreme Audit Agency head Anwar Nasution, the whistle-blower in the case, and two other witnesses, former BI deputy governor Iwan R. Prawiranata and lawmaker Hamka Yamdhu, yesterday.
BI governor Burhanuddin Abdullah, who was named a suspect by the commission last month, is expected to be questioned next week.
According to allegations contained in a document issued by the commission earlier, they were involved in the misappropriation of BI funds amounting to up to 100 billion rupiah.
About 31.5 billion rupiah has allegedly been transferred to members of the House of Representatives during deliberations to revise the Law on Finance in 2004. The money was said to have originated from the accounts of the central bank's Banking Development Foundation.
The funds allegedly served as "grease money" to smooth the passage of the revised law. The remaining 68.5 billion rupiah was suspected to have been used to hire some lawyers to settle BI's liquidity support cases in 2003-2004, involving the former BI governor and deputy governors, the document said.
Observers have said the decision to bring graft charges against the officials could be politically motivated, given that the case emerged just a few months before parliament is scheduled to appoint a new central bank governor and Abdullah still has a chance to run for a second five-year term.
President Susilo Bambang Yudhoyono is expected to submit a list of candidates for a new central bank governor to the lower house of Parliament today.
Abdullah indicated earlier this week his intention not to seek re-appointment.
(1 US dollar = 9,259 rupiah)
roffie.kurniawan@thomson.com
No recession yet, Greenspan says
Fri, Feb 15 2008, 03:10 GMT
http://www.afxnews.com
HOUSTON (AP) - Former Federal Reserve Chairman Alan Greenspan said Thursday night the American economy is "clearly on the edge" of a recession, and he pointed to the depressed housing market as a primary culprit.
In dinner remarks to about 1,100 energy industry executives, academics and others, Greenspan said the odds are 50 percent or better the country is headed toward a recession. His prediction came several hours after his Federal Reserve successor, Ben Bernanke, told Congress the economy is deteriorating, but he still looks for slow growth as 2008 transpires.
Greenspan said the reason the recent credit crunch -- triggered by the subprime lending debacle -- hasn't hit U.S. businesses particularly hard is because they've been operating in a time of high cash flows, minimizing their need for such credit options.
"If it weren't for the fact that business was in such extraordinary good shape before this problem hit, I don't think we'd be questioning at this stage whether we're in a recession," Greenspan said during a question-and-answer session with Daniel Yergin, chairman of Cambridge Energy Research Associates, the Massachusetts-based consultancy that sponsored the dinner.
"We'd be talking about how long and how deep," he said. "And we're not there yet."
Greenspan, 81, gave no prepared remarks.
The collapse of the housing market, sour mortgage investments and much harder-to-get credit are weighing heavily on the economy. Foreclosures have hit record highs, and banks have racked up multibillion-dollar losses.
Greenspan said he thinks the housing market will continue to erode until the cause of the deterioration ends.
"Where all the problem is coming from is the continuous marking down of the value of those subprime securities," he said. "Until we stabilize the price level of homes ... you're going to continuously get loss estimates" from banks and other financial institutions.
When might the housing crisis hit rock bottom, Yergin asked.
The country still has "a long way to go," Greenspan responded.
In a speech a few weeks ago in Canada, Greenspan also said the odds of a U.S. recession were 50 percent or "slightly more."
On that occasion, he said subprime mortgages were "a valuable product" that helped increase home ownership in the U.S., especially among minorities.
However, he said what began as a niche part of the mortgage market grew as hedge funds sought out the collateralized paper associated with the loans.
Greenspan said recently it was the repackaging and sale to investors of the risky home loans -- not the subprime loans themselves -- that were to blame for the global credit crisis.
Earlier Thursday, Bernanke told the Senate Banking Committee the one-two punch of housing and credit crises has strained the economy, and he forecast sluggish growth in the near term.
Given all the dangers facing the economy, he said, the Fed "will act in a timely manner as needed to support growth and to provide adequate insurance against downside risks."
The Federal Reserve, which started lowering a key interest rate in September, has recently turned much more aggressive. Over the span of eight days in January, it slashed rates by 1.25 percentage points -- the biggest one-month rate reduction in a quarter-century. Economists and Wall Street investors believe the Fed will cut rates even more at its next meeting in March and probably again in April.
Under Greenspan, the U.S. Federal Reserve slashed interest rates between early 2001 to the summer of 2003 to their lowest level in decades.
Critics have complained Greenspan failed to act in his role as a regulator during the subsequent housing boom in the U.S., as easy credit spurred subprime home loans.
The former Fed chairman, who served in the role for 19 years -- from 1987 to 2006 -- has acknowledged he failed to see early on the potential danger of the increase in mortgages to people with questionable credit histories.
Greenspan now works as a private consultant for firms through his company, Greenspan Associates LLC.
He also has a best-selling new book, "The Age of Turbulence: Adventures in a New World."
OIL DATA:Table Of Japan Jan Power Output, Utilities Fuel Use
Fri, Feb 15 2008, 02:28 GMT
http://www.djnewswires.com/eu
OIL DATA:Table Of Japan Jan Power Output, Utilities Fuel Use

Power output from Japan's 10 regional electricity companies by type:
Jan 2008 Change on Year
Hydro: 4.00 Bln kWh -1.1%
Thermal: 50.46 Bln kWh +16.9%
Nuclear: 21.24 Bln kWh -13.6%
Purchased: 15.72 Bln kWh +4.4%
Total: 90.42 Bln kWh +4.9%

Nuclear Capacity Used: Jan 2008 Jan 2007
60.7% 69.8%

Fuel consumption by Japan's 10 regional electricity companies by type:

(Crude oil and fuel oil are in kiloliters, LNG and coal are in metric tons.)
Jan 2008 Jan 2007
Coal: 5,091,634 5,003,804
Fuel Oil: 1,343,798 1,241,742
Crude Oil: 1,185,674 1,221,155
LNG: 3,602,781 2,926,385

Note: Figures don't necessarily add up to the total because of rounding and because the companies subtract electricity used in the production process from the total. For percentage of nuclear capacity used, figures reflect operating rates during those periods.
(Source: Federation of Electric Power Companies)

-By Mari Iwata, Dow Jones Newswires; 813-5255-2929; mari.iwata@dowjones.com

(END) Dow Jones Newswires

OIL DATA: Japan Jan Power Output Up 4.9% At 90.42B KWh
Fri, Feb 15 2008, 02:07 GMT
http://www.djnewswires.com/eu
OIL DATA: Japan Jan Power Output Up 4.9% At 90.42B KWh

TOKYO (Dow Jones)--Electricity generated by Japan's 10 regional power utilities in January rose 4.9% on year to 90.42 billion kilowatt-hours owing to cold weather in the month and continued strong industrial demand, the Federation of Electric Power Companies said Friday.

The utilities used 1.19 million kiloliters of crude oil in the month, down from 1.22 million kiloliters a year earlier, the federation said.

-By Mari Iwata, Dow Jones Newswires; 813-5255-2929; mari.iwata@dowjones.com

(END) Dow Jones Newswires

February 14, 2008 21:07 ET (02:07 GMT)

China yuan central parity rate set at record 7.1763 to dollar vs 7.1890
Fri, Feb 15 2008, 01:36 GMT
http://www.afxnews.com
BEIJING (XFN-ASIA) - The central bank has set the yuan central parity rate at a record 7.1763 to the dollar, according to the China Foreign Exchange Trading System.
The rate, published on the official Chinamoney website (www.chinamoney.com.cn), compares with the midpoint of 7.1890 set the previous trading day.
The People's Bank of China (PBoC) started setting a daily central parity rate on Jan 4, 2006.
On July 21, 2005, China freed the yuan from its long-standing peg to the dollar in favor of a trade-weighted basket of currencies, and allowed the local unit to appreciate by 2.1 pct.
The PBoC allows a trading band of 0.5 pct on either side of the central parity rate.
allen.shu@xfn.com

FOREXFC FOREX NEWS COLLECTIONS

2008-02-14T19:22:00.000-08:00

Japan Outlook:BOJ Mtg Ends,BOJ Fukui Holds Press Conference
Thu, Feb 14 2008, 22:30 GMT
http://www.djnewswires.com/eu
Japan Outlook:BOJ Mtg Ends,BOJ Fukui Holds Press Conference

TOKYO (Dow Jones)--Here are the major economic events scheduled in Japan on Friday. All times refer to GMT.

INDICATORS

No major indicators are scheduled for release Friday.
-
EVENTS
2350 Ministry of Finance releases weekly portfolio flow
data for Feb. 3-9.
N/A Bank of Japan two-day policy board meeting ends.
N/A News conferences after morning Cabinet meeting:
-Finance Minister Fukushiro Nukaga
-Economy Minister Hiroko Ota
-Banking Minister Yoshimi Watanabe
-Chief Cabinet Secretary Nobutaka Machimura
-Minister of Economy, Trade and Industry Akira
Amari
0600 BOJ releases monthly report.
0630 BOJ Gov. Toshihiko Fukui holds press conference.
-
CORPORATE EVENTS
0500 Japan Petroleum Exploration Co. (1662.TO) releases
April-December earnings results.
0600 Sapporo Holdings Ltd. (2501.TO) releases earnings

results for last fiscal year.
-Tokyo Bureau, Dow Jones Newswires; 813-5255-2929

Colombia's Car Sales Fall 6.3% In Jan On Yr To 17,517 Units
Thu, Feb 14 2008, 22:38 GMT
http://www.djnewswires.com/eu
Colombia's Car Sales Fall 6.3% In Jan On Yr To 17,517 Units

BOGOTA (Dow Jones)--Colombian automotive vehicle sales at the wholesale level fell 6.3% in January from the same month a year ago to 17,517 units, according to data from the industry group Comite Automotor released Thursday.

This is the first time monthly sales fell compared with the year-earlier month since November 2003, when sales fell 1%, and the biggest decline since June 2003, when sales plummeted 13%, the Comite Automotor said.

General Motors Corp. (GM) topped the sales rankings in January with 6,522 units, down 11% from the same month in 2007.

French car maker Renault (13190.FR) took the No. 2 spot, with 2,240 units sold in January, 29% lower than the 3,176 cars sold in January 2007.

Korean Hyundai Motor Co (005380.SE) sold 1,592 cars in January, down 13% from the same month in 2007, when 1,830 units were sold.

In 2005, 2006 and 2007, car sales rose at a faster pace than 25% as a strong peso and lower interest rates encouraged people to buy cars. In 2007, Colombian care sales at a wholesale level reached an all-time record of 258,443 units.

Comite Automotor's statistics cover more than 90% of the vehicles sold in Colombia, including buses, private vehicles, taxis and trucks.

-By Inti Landauro, Dow Jones Newswires; 57-1-600 19 80; colombia@dowjones.com

(END) Dow Jones Newswires

February 14, 2008 17:38 ET (22:38 GMT)

Treasurys lower on Bernanke comments
Thu, Feb 14 2008, 22:52 GMT
http://www.afxnews.com
NEW YORK (AP) - Long-term Treasurys sold off for a third straight session Thursday after the latest weekly unemployment benefits tally suggested some stabilization in a worrisome labor market.
Signs of economic improvement do not as a rule benefit the Treasury market, which generally performs best when investors are nervous about the economic outlook and want secure goverment-guaranteed assets.
On Thursday, the Labor Department said first-time jobless claims dropped for a second week in a row. Claims for the week to Feb. 9 fell 9,000 to 348,000. Although weekly jobless claims data is volatile, investors were heartened by the latest figures as they followed recent news that the economy gave up jobs in January.
Ian Shepherdson, chief U.S. economist at High Frequency Economics, questioned the market's cheery interpretation of the data, noting that the four-week moving average for the claims actually rose last week.
"We expect claims to continue grinding higher in the wake of the clear downturn in business sentiment," Shepherdson said.
The benchmark 10-year Treasury note fell 25/32 to 97 12/32 with a yield of 3.82 percent, up from 3.73 percent late Wednesday, according to BGCantor Market Data. Prices and yields move in opposite directions.
The 30-year long bond dropped 1 19/32 to 95 17/32 with a yield of 4.65 percent, up from 4.55 percent.
The 2-year note closed unchanged at 100 13/32 with a 1.91 percent yield, unchanged from late Wednesday.
Long-term yields were unchanged in after hours trade. At 5:30 p.m. Eastern time, the 10-year yield remained 3.82 percent and the 30-year yield was still 4.65 percent, but the 2-year yield inched down to 1.90 percent.
The 3-month rate rose to 2.29 percent from 2.27 percent late Thursday as the discount rate ticked up to 2.24 percent from 2.22 percent.
The selling pressure was heaviest on longer-term bonds because they are the most sensitive to inflationary pressures. Positive economic data suggests an improving economy could set off higher inflation over the long haul.
By contrast, short-term notes were little changed, benefiting from anticipated rate cuts in the near future. Short-term notes are the most sensitive to rate expectations.
Federal Reserve Chairman Ben Bernanke on Thursday made remarks to lawmakers viewed as confirming that the Fed remains in rate-cutting mode.
Bernanke's testimony to the Senate Banking Committee gave a temporary boost to the bond market, although government bonds remained in negative territory. Treasury investors would like to see cheaper money.
The Fed chief's basic message appeared to be that the Fed, which cut the overnight Fed funds rate by a full 1.25 percentage points in January, has done its best to stimulate a sagging economy and fractured credit markets, but is willing to do even more.
New York State Insurance Superintendent Eric Dinallo also appeared on Capitol Hill Thursday. He argued in favor of splitting troubled bond insurers MBIA Inc. and Ambac Financial Group Inc. into two parts. That would separate the high-risk subprime assets they backed from the healthier municipal bond instruments.
Dinallo has led a coalition of government officials and top banks that is seeking financing for hard-hit bond insurers.
Also on Thursday another troubled bond insurer, FGIC Corp., had its "AAA" rating cut two notches to "A3" by Moody's Investors Service.
The insurer failed to raise enough capital to pay for an unexpected spike in claims on subprime debt. FGIC needed about $4 billion to maintain the "AAA" rating.

Forex - Dollar up vs euro, sterling after overnight losses on Bernanke remarks
Thu, Feb 14 2008, 23:43 GMT
http://www.afxnews.com
SYDNEY (Thomson Financial) - The US dollar was higher against the euro and sterling midway through the morning session in Sydney on Friday, trimming overnight losses after Federal Reserve Chairman Ben Bernanke warned of sluggish economic growth until the end of the year and indicated the central bank is prepared to continue cutting interest rates to revitalise the world's largest economy.
Hawkish comments from European Central Bank member Axel Weber, coupled with Britain's recent strong wholesale inflation figures, added to pressure on the greenback.
The euro was buying 1.4637 dollars versus 1.4639 dollars in late New York trade after Weber
said the ECB would see a noticeable upward trend of long-term inflationary expectations as a
"clear signal" that it needs to act.
The sterling was worth 1.9685 dollars compared to 1.9689 dollars overnight while the dollar was down at 107.86 yen from 107.92 yen.
''Most of the chairman's (Bernanke's) comments reflected continuing concern about economic prospects, with banks and Wall Street expected to take more hits and 'more expensive and less available credit' a source of restraint on growth, and by extension, the US dollar,'' said John Kyriakopoulos, head of currency strategy at NAB Capital.
Elsewhere, the Australian dollar was doing 90.19 US cents compared with 90.14 cents overnight on expectations the Reserve Bank of Australia will tighten interest rates further.
Sydney at 9.55 am (2255 GMT)
US dollar
107.86 yen
1.097 sfr
Euro
1.4637 usd
157.86 yen
1.6059 sfr
0.7436 stg
Sterling
1.9685 usd
212.334 yen
2.15877 sfr
Australian dollar
0.9019 usd
0.4582 stg
97.27 yen
New Zealand dollar
0.7864 usd
allison.jackson@thomson.com
aj/ms
bhx/ms
Japan Portfolio Flows Table, Week of 3 - 9 Feb 2008
Thu, Feb 14 2008, 23:50 GMT
http://www.djnewswires.com/eu
Japan Portfolio Flows Table, Week of 3 - 9 Feb 2008

1. Purchases and Sales of Foreign Securities by Residents

(Figures are in billion yen)

Equity Securities
Purchases Sales Net
06 - 12 Jan 2008 511.5 473.3 38.3
13 - 19 Jan 2008 766.6 581.8 184.8
20 - 26 Jan 2008 865.6 556.4 309.2
27 Jan - 02 Feb 2008 703.2 590.0 113.2
03 - 09 Feb 2008 496.4 371.8 124.6

Bonds and Notes
Purchases Sales Net
06 - 12 Jan 2008 3692.1 2869.2 822.9
13 - 19 Jan 2008 4042.8 3040.4 1002.4
20 - 26 Jan 2008 4617.6 4489.5 128.1
27 Jan - 02 Feb 2008 3694.0 3206.6r 487.4r
03 - 09 Feb 2008 3722.5 3255.2 467.3

Equities, Bonds, Notes Subtotal
Net
06 - 12 Jan 2008 861.2
13 - 19 Jan 2008 1187.2
20 - 26 Jan 2008 437.3
27 Jan - 02 Feb 2008 600.6r
03 - 09 Feb 2008 591.9

Money Market Instruments
Purchases Sales Net
06 - 12 Jan 2008 249.2 117.0 132.2
13 - 19 Jan 2008 191.5 164.2 27.3
20 - 26 Jan 2008 256.4 245.1 11.3
27 Jan - 02 Feb 2008 99.8 148.9 -49.1
03 - 09 Feb 2008 157.2 292.9 -135.8

Equities, Bonds, Notes, MMI Total
Net
06 - 12 Jan 2008 993.4
13 - 19 Jan 2008 1214.5
20 - 26 Jan 2008 448.6
27 Jan - 02 Feb 2008 551.5r
03 - 09 Feb 2008 456.1

Figures marked 'r' are revised.

2. Purchases and Sales of Domestic Securities by Non-Residents

(Figures are in billion yen)

Equity Securities
Purchases Sales Net
06 - 12 Jan 2008 7330.4 7394.9 -64.6
13 - 19 Jan 2008 7249.2 7616.7 -367.6
20 - 26 Jan 2008 7871.2 8430.2 -559.0
27 Jan - 02 Feb 2008 6860.5 7309.3r -448.8r
03 - 09 Feb 2008 6934.4 6973.6 -39.1

Bonds and Notes
Purchases Sales Net
06 - 12 Jan 2008 2768.5 2298.4 470.1
13 - 19 Jan 2008 2150.8 1853.4 297.4
20 - 26 Jan 2008 2567.4 2693.2 -125.8
27 Jan - 02 Feb 2008 2065.0 2079.5r -14.5r
03 - 09 Feb 2008 2608.8 2084.0 524.8

Equities, Bonds, Notes Subtotal
Net
06 - 12 Jan 2008 405.6
13 - 19 Jan 2008 -70.2
20 - 26 Jan 2008 -684.8
27 Jan - 02 Feb 2008 -463.3r
03 - 09 Feb 2008 485.7

Money Market Instruments
Purchases Sales Net
06 - 12 Jan 2008 2596.2 2905.9 -309.7
13 - 19 Jan 2008 1356.1 2274.0 -917.8
20 - 26 Jan 2008 1475.6 2055.2 -579.7
27 Jan - 02 Feb 2008 1795.9 1522.9 273.0
03 - 09 Feb 2008 2442.3 2278.9 163.4

Equities, Bonds, Notes, MMI Total
Net
06 - 12 Jan 2008 95.9
13 - 19 Jan 2008 -988.0
20 - 26 Jan 2008 -1264.5
27 Jan - 02 Feb 2008 -190.3r
03 - 09 Feb 2008 649.1

Figures marked 'r' are revised.

The next release is scheduled on Thursday, February 21.

SOURCE: Japan Ministry of Finance

(END) Dow Jones Newswires

February 14, 2008 18:50 ET (23:50 GMT)

Fitch cuts $11.3B Morgan Stanley debt
Thu, Feb 14 2008, 23:51 GMT
http://www.afxnews.com
NEW YORK (AP) - Fitch Ratings on Wednesday downgraded $11.3 billion worth of Morgan Stanley mortgage pass-through certificates, and affirmed $3.3 billion worth of the certificates.
The certificates were part of 16 subprime loans that were either originated or acquired by Morgan Stanley. Many classes were cut far into "junk" or non-investment-grade status from investment-grade ratings such as 'A-' and 'BBB+'.
Mortgage-backed certificates are the most common type of pass-through, where homeowners' payments pass from the original bank through a government agency or investment bank to investors. As the housing market continues to slide, and homes are foreclosed upon in increasing numbers due to the subprime mortgage crisis, these investments have significantly declined in value.

UBS:Mexico 'Relative Loser' Of MSCI Rebalance; China Benefits

2008-02-14T16:51:00.000-08:00

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UBS:Mexico 'Relative Loser' Of MSCI Rebalance; China Benefits

NEW YORK (Dow Jones)--Mexico emerged as the "relative loser" of the latest MSCI rebalance, as the North American country's weight within the index fell to 4.8% from 5%, UBS Investment Research said Thursday.

China's weight, on another hand, has increased to 14.8% from 14.6% in the MSCI, "making it the biggest single market (just ahead of Brazil with 14.7%)," UBS added.

In its latest rebalance, announced Thursday, MSCI added 12 new securities and deleted one. Among the securities added were Colombia's Ecopetrol (ECOPETROL.BO), India's Reliance Petroleum (532743.BY) and Brazil's Localiza Rent A Car (RENT3.BR), skewing the additions towards energy and materials sectors, UBS said. Indonesia's Kalbe Farma (KLBF.JK) was deleted.

All changes announced this week become effective at the close of markets Feb. 29. The changes are part of ongoing changes at MSCI, which is expected to implement a second and final phase of the transition in its May review.

"Just as it was with the first phase transition, which took place last November, this will be a major liquidity event," UBS said.

For the enhanced standard indexes, MSCI Barra is targeting a coverage range of around 85% of the free float adjusted market cap in each market, with the enhanced small cap indexes targeting companies that fall below the size threshold of the enhanced standard indexes, the investment bank added.

-By Claudia Assis, Dow Jones Newswires; 201-938-4385; claudia.assis@dowjones.com

(END) Dow Jones Newswires

Dollar slides after Bernanke statements

2008-02-14T16:50:00.001-08:00

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NEW YORK (AP) - The dollar fell Thursday after Federal Reserve Chairman Ben Bernanke sounded a broad warning on the U.S. economy and implied that the central bank would keep up interest rate cuts if necessary.

Lower interest rates can jump-start a country's economy, but may weigh on its currency as traders transfer funds to countries where they can earn higher returns.

The euro rose to $1.4633 from $1.4576 in New York late Wednesday, and the British pound rose to $1.9691 from $1.9649.

The dollar fell to 107.93 Japanese yen from 108.20 yen, and slumped to 1.0973 Swiss francs from 1.1079 Swiss francs.

The Commerce Department reported Thursday that the U.S. trade deficit narrowed in 2007, dropping to $711.6 billion, after five years or record expansion. A weak dollar made U.S. goods more competitive abroad, boosting exports.

The Labor Department also reported Thursday that the number of people filing for unemployment benefits dropped by 9,000 to 348,000 last week. Analysts had expected a drop of only 6,000.

However, Bernanke's comments outweighed any positive data, dragging down Wall Street and the dollar.

The dollar has grown increasingly resistant to negative economic data over the past few weeks, and it was likewise resistant to Thursday's positive data, said Ashraf Laidi, chief currency strategist at CMC Markets US.

Bernanke's "words and his pronouncements bear a greater sense of immediacy on the Fed's negative assessment on the U.S. economy than any economic indicator," he said, adding "They carry implications of what (the Fed) is going to do."

In other New York trading, the dollar rose to 99.99 Canadian cents from 99.76 Canadian cents.

Home sales fell in 45 states in 4Q

2008-02-14T16:43:00.000-08:00

WASHINGTON (AP) - Sales of existing homes fell in 45 states during the October-December quarter, with metropolitan areas showing growing weakness, a real estate trade group said Thursday.

The fourth-quarter data from the National Association of Realtors underscore the breadth of the housing market's slump.

South Dakota was the lone state to show a sales increase. Existing home sales there rose 8.9 percent from the same quarter a year ago. Sales were unchanged in North Dakota. No sales figures were available for Idaho, Indiana and New Hampshire. Sales also fell in Washington, D.C.

Median home prices fell in more than half of the 150 metropolitan areas surveyed. Out of the 77 that experienced declines, 16 showed double-digit percentage drops, the trade group said. The largest price declines were found in Lansing, Mich., Sacramento, Calif., Jackson, Miss. and Riverside, Calif., which posted price declines of 17 to 19 percent.

Lawrence Yun, the trade group's chief economist, attributed the declines in median prices to mortgage market problems that mushroomed last fall, making loans more expensive for borrowers looking to take out "jumbo" mortgages larger than $417,000, the maximum size of mortgages that government-sponsored mortgage companies Fannie Mae and Freddie Mac can purchase and market as securities

"The continuing crunch in the jumbo loan market that began in August has disproportionately reduced the number of transactions in higher price ranges," Yun said in a statement.

Nationwide, existing homes sold at an annual rate of 4.96 million units in the fourth quarter, down 21 percent from the sales pace of the fourth quarter in 2006, the Realtors group said.

The states suffering the biggest drop in sales in the fourth quarter were Nevada, down 44 percent and Wyoming, down 42 percent. Other states with big declines were New Mexico, down 39 percent, Oregon, down 38 percent and Arizona, down 37.6 percent.

Mortgage lenders, would-be homebuyers and Wall Street investors alike have been grappling over the past year with the impact of rising defaults, the result of lax lending standards that were prevalent during this decade's housing boom. As defaults have risen, lenders have grown more cautious, which has allowed fewer buyers to qualify for home loans.
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(This version CORRECTS the eighth paragraph to state that sales drops refer to fourth quarter, not third quarter.)

US M1 UP $20.1 Bln In Feb 4 Week; M2 UP $33.8 Bln

2008-02-14T16:33:00.000-08:00

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US M1 UP $20.1 Bln In Feb 4 Week; M2 UP $33.8 Bln

NEW YORK (Dow Jones)--The Federal Reserve's latest weekly money supply report Thursday shows seasonally adjusted M1 rose by $20.1 billion to $1.383 trillion, while M2 increased by $33.8 billion to $7.569 trillion.

The figures are preliminary estimates for the week extending through Feb. 4 and are subject to revisions.

More details on the report, along with weekly information on the Fed's custody holdings, repurchase agreements, Treasury portfolio and free reserves, can be found on the Internet at http://www.federalreserve.gov/releases/.

-By Min Zeng, Dow Jones Newswires; 201-938-2096; min.zeng@dowjones.com

-0-

Foreign Ctrl Banks Sold $4.698B US Govt Bonds In Feb 13 Week

2008-02-14T16:20:00.001-08:00

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Foreign Ctrl Banks Sold $4.698B US Govt Bonds In Feb 13 Week

NEW YORK (Dow Jones)--Foreign central banks sold a weekly average of $4.698 billion of U.S. government securities in the week ended Feb. 13.

According to the Federal Reserve's statistical release Thursday, custody holdings of U.S. Treasurys for foreign official accounts held by the Federal Reserve fell by $452 million to $1.267 trillion.

At the same time, the weekly average of the Fed's custody holdings of agency securities fell by $4.24 billion to $846.229 billion.

On a Wednesday-to-Wednesday basis, custody holdings of U.S. government securities rose by $9.622 billion to $2.122 trillion.

Foreign central banks bought $3.567 billion of Treasurys and $6.055 billion of agency securities.

The data cover investments held at the Fed on behalf of foreign central banks.

-By Min Zeng, Dow Jones Newswires; 201-938-2096; min.zeng@dowjones.com

(END) Dow Jones Newswires

US Fed Discount Window Borrowings Fall This Week

2008-02-14T16:19:00.000-08:00

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US Fed Discount Window Borrowings Fall This Week

WASHINGTON (Dow Jones)--Banks lowered their borrowing at the Federal Reserve discount window this week.

Borrowings at the window totaled $39 million as of Wednesday, down from $459 million the week ending Feb. 6.

Lending through the primary credit facility as of Wednesday this week was $38 million. Seasonal credit was $1 million.

Average daily borrowing for the week ending Feb. 13 was $58 million. The average the week prior was $145 million.

The Fed's discount window has traditionally served as its primary source of emergency credit. Banks are reluctant to take advantage of this source of funding because of the sense that tapping emergency credit could alarm peers and invite greater regulatory scrutiny. Furthermore, the higher interest rate on discount borrowing also discourages its use.

In December, the Fed announced it would hold special sales of short-term credit in a bid to address liquidity problems in the short-term money market.

The central bank has also been lowered the federal funds rate target. The Fed on Jan. 30 lowered the funds rate by 0.50 percentage point to 3.0%, capping a massive 125-basis-point reduction over nine days spawned by fears of recession.

-By Jeff Bater, Dow Jones Newswires; 202 862 9249; jeff.bater@dowjones.com

(END) Dow Jones Newswires

Discount Window Borrowings Wednesday By Fed District

2008-02-14T16:18:00.000-08:00

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Discount Window Borrowings Wednesday By Fed District

District Wednesday (Previous Wednesday)

Atlanta $ 0 0 Mln
Boston 1 0
Chicago 4 0
Cleveland 0 440
Dallas 0 0
Kansas City 1 1
New York 0 0
Minneapolis 0 0
Philadelphia 1 0
Richmond 1 0
San Francisco 32 18
St. Louis 0 0
Total 39 459

Includes adjustment borrowings, seasonal borrowings and extended credit. They are not weekly averages. Components may not add to totals due to rounding.

(END) Dow Jones Newswires

February 14, 2008 16:30 ET (21:30 GMT)

UPDATE: Trichet: Environments Different In US And Euro Zone

2008-02-14T16:17:00.002-08:00

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UPDATE: Trichet: Environments Different In US And Euro Zone

(Updates with further comments from Trichet, background)

BARCELONA -(Dow Jones)- European Central Bank President Jean-Claude Trichet Thursday said the U.S. and euro-zone economies are in different situations and have different interest-rate requirements.

Trichet reiterated that no ECB Governing Council members had asked for either rate increases or cuts at the council's last meeting earlier this month. The more neutral stance toward interest rates came after previous signals the central bank was considering raising rates.

Many observers now expect the ECB to lower interest rates in the coming months. The U.S. Federal Reserve has moved aggressively to lower rates in the face of financial turmoil that has negatively impacted economic growth.

"We (central bankers) all have our responsibilities, in the context of our own economies," Trichet said, adding that interest rates have never been at the same level in all the world's major industrialized countries.

After making a speech on globalization and monetary policy, Trichet was answering a question about whether the interest-rate differential between the U.S. and the euro zone represented a problem for the ECB.

In reference to the financial crisis triggered by the meltdown of the U.S. subprime mortgage market, Trichet said "there was a very significant market correction underway." Trichet said the correction didn't come as a surprise as risk had been underpriced for too long in international financial markets.

Trichet said that globalization - increased international trade - has had a large impact on relative prices around the world. He said asset prices have converged markedly, though prices in tradable goods have converged less.

The ECB president said globalization has had a "small dampening effect" of up to 0.3 percentage point on consumer price inflation in the euro zone.

Trichet said that the deflationary impact of lower-priced goods from countries like China and India has been largely canceled out by the surge in commodities prices as the result of higher demand in these same countries. He said he expected the surge in prices for soft commodities, notably food, would continue to represent an "upside risk" to euro-zone consumer prices.

Trichet said globalization and increased outsourcing had contributed to the process of wage moderation seen in recent years in the euro zone, which in turn had fueled job creation.

In the current scenario of soaring food and oil prices, Trichet said the ECB was committed to preventing these price increases from passing through to higher wages, and to maintaining medium-term stability in consumer prices. He said inflation is determined by monetary policy.

-By Jonathan House, Dow Jones Newswires; +34 619 93 39 52; jonathan.house@dowjones.com

(END) Dow Jones Newswires

Ackman discloses puts on bond insurers

2008-02-14T16:17:00.001-08:00

NEW YORK (AP) - Hedge fund manager William Ackman owns puts on the shares of troubled bond insurers MBIA Inc. and Ambac Financial Group Inc. valued at about $1.8 million, according to a regulatory filing Thursday.

Ackman's Pershing Square Capital Management LP reported owning puts on 1 million Ambac shares and 697,700 MBIA shares.

A stock put is an option contract that gives the owner the right, but not the obligation, to sell a specified number of securities at a set price within a certain period of time. The buyer of a put estimates that the value of the underlying stock will fall below the exercise price before the expiration date, essentially betting on falling prices to make a profit during market downturns.

Concerns about the soundness of bonds and, in turn, the bond insurers have eroded Wall Street's confidence about the debt markets in recent months.

Bond insurers pay claims when a bond issuer misses payments. As mortgages have increasingly defaulted, ratings agencies and investors have worried that would lead to more defaults on bonds backed by the troubled loans. Those defaults could set off a surge in claims that could be unmanageable for bond insurers.

In late January, Ackman estimated MBIA faces more than $11 billion in potential losses from exposure to the mortgage market. MBIA has said Ackman's model for calculating the estimate is flawed.

MBIA shares jumped $1.14, or 9.8 percent, to $12.78 in afternoon trading. Shares have fallen 82 percent from an annual high of $72.38 last April. Likewise, Ambac shares spiked $1.22, or 13 percent, to $10.59. The stock has plunged 90 percent from a high of $96.10 in May.

New York Money Market Rate Indications

2008-02-14T16:16:00.000-08:00

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New York Money Market Rate Indications

Bankers acceptances at 3:57 p.m. New York time.
1M 3.12
2M 3.10
3M 3.70
6M 2.95
9M 2.88
1Y 2.83
Federal funds: days high 3.09; low 2.81: latest bid 3.06; offered 3.06; prime lending rate at major banks 6.00; broker call loan rate 4.75

Dealer-placed commercial paper
30 days 3.07
60 days 3.05
90 days 3.03

Treasury bills
30 days 2.46-45 up .018
90 days 2.23-23 up .020
180 days 2.05-04 up .008

Moody's yield figures
AAA corps 5.52

Farmers, construction equipment owners and makers may benefit from stimulus bill

2008-02-14T16:15:00.000-08:00

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SAN FRANCISCO (Thomson Financial) - The economic stimulus bill signed Wednesday by President Bush will probably prove a boon to the machinery sector, with agricultural machinery in particular likely to benefit, an analyst said.

The 2008 Economic Stimulus Bill includes bonus depreciation equal to 50% of the adjusted property basis and raises to $250,000 and $800,000 the limits at which taxpayers may consider a capital equipment purchase an expense in year one rather than a depreciable item.

"In a year with record cash receipts, an accelerated deprecation schedule would serve as a strong incentive for farmers to purchase equipment because it gives them an aggressive way to shield their incomes from tax obligations," Bear Stearns analyst Ann Duignan wrote in a research note to clients Thursday.

Other machinery sectors, including companies that supply capital equipment to the construction, truck and automotive industries, may also get a boost from the bill, Duignan said.

Agricultural machinery sales "have a high correlation with total farm cash receipts," she noted. Duignan expects total farm cash receipts of $313 billion in 2008.

Moline, Oll.-based Deere & Co., Cleveland-based Eaton Corp., Amsterdam, Netherlands-based CNH Global NV and, to a lesser extent, Peoria, Ill.-based Caterpillar Inc. and Duluth, Ga.-based Agco Corp. could be among the beneficiaries, she said.

Deere would probably benefit the most among agricultural machinery companies as it has the greatest U.S. exposure, she said. The stock was trading up $1.10 at $86.64.

Eaton shares were down $1.69 at $80.81. CNH Global stock fell 91 cents to $48.15. Caterpillar's stock, a component of the Dow industrials, dropped $1.10 to $70.55 and Agco stock was down $2.20 at $63.99.

Treasurys lower on Bernanke comments

2008-02-14T16:14:00.000-08:00

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NEW YORK (AP) - Long-term Treasurys sold off for a third straight session Thursday after the latest weekly unemployment benefits tally suggested some stabilization in a worrisome labor market.

Signs of economic improvement do not as a rule benefit the Treasury market, which generally performs best when investors are nervous about the economic outlook and want secure goverment-guaranteed assets.

On Thursday, the Labor Department said first-time jobless claims dropped for a second week in a row. Claims for the week to Feb. 9 fell 9,000 to 348,000. Although weekly jobless claims data is volatile, investors were heartened by the latest figures as they followed recent news that the economy gave up jobs in January.

Ian Shepherdson, chief U.S. economist at High Frequency Economics, questioned the market's cheery interpretation of the data, noting that the four-week moving average for the claims actually rose last week.

"We expect claims to continue grinding higher in the wake of the clear downturn in business sentiment," Shepherdson said.

The benchmark 10-year Treasury note fell 25/32 to 97 12/32 with a yield of 3.82 percent, up from 3.73 percent late Wednesday, according to BGCantor Market Data. Prices and yields move in opposite directions.

The 30-year long bond dropped 1 19/32 to 95 17/32 with a yield of 4.65 percent, up from 4.55 percent.

The 2-year note closed unchanged at 100 13/32 with a 1.91 percent yield, unchanged from late Wednesday.

The 3-month rate rose to 2.29 percent from 2.27 percent late Thursday as the discount rate ticked up to 2.24 percent from 2.22 percent.

The selling pressure was heaviest on longer-term bonds because they are the most sensitive to inflationary pressures. Positive economic data suggests an improving economy could set off higher inflation over the long haul.

By contrast, short-term notes were little changed, benefiting from anticipated rate cuts in the near future. Short-term notes are the most sensitive to rate expectations.

Federal Reserve Chairman Ben Bernanke on Thursday made remarks to lawmakers viewed as confirming that the Fed remains in rate-cutting mode.

Bernanke's testimony to the Senate Banking Committee gave a temporary boost to the bond market, although government bonds remained in negative territory. Treasury investors would like to see cheaper money.

The Fed chief's basic message appeared to be that the Fed, which cut the overnight Fed funds rate by a full 1.25 percentage points in January, has done its best to stimulate a sagging economy and fractured credit markets, but is willing to do even more.

New York State Insurance Superintendent Eric Dinallo also appeared on Capitol Hill Thursday. He argued in favor of splitting troubled bond insurers MBIA Inc. and Ambac Financial Group Inc. into two parts. That would separate the high-risk subprime assets they backed from the healthier municipal bond instruments.

Dinallo has led a coalition of government officials and top banks that is seeking financing for hard-hit bond insurers.

Also on Thursday another troubled bond insurer, FGIC Corp., had its "AAA" rating cut two notches to "A3" by Moody's Investors Service.

The insurer failed to raise enough capital to pay for an unexpected spike in claims on subprime debt. FGIC needed about $4 billion to maintain the "AAA" rating.

CME Forex, Financial Estimated Futures Volumes - Feb 14

2008-02-14T16:12:00.000-08:00

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CME Forex, Financial Estimated Futures Volumes - Feb 14

For today, in contracts.

Currencies Financials
Euro 153,350 Eurodollar 3,047,574
Japanese yen 92,523 Libor 1,147
Swiss franc 53,156 Euroyen 529
British pound 56,270
Canadian dollar 44,253
Australian dollar 39,247
Mexican Peso 13,644
New Zealand dollar 1,496
South African Rand 46
Brazilian Real 60
Russian Rubble 1

-By Kathy Lang; Dow Jones Newswires; 913-322-5172;
csstat@dowjones.com

Forex - Dollar strengthens on better-than-expected US trade deficit data

2008-02-14T06:17:00.001-08:00

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Thu, Feb 14 2008, 14:03 GMT
http://www.afxnews.com

LONDON (Thomson Financial) - The dollar strengthened after US data revealed a bigger-than-expected reduction in the trade deficit of the world's largest economy.

The Commerce Department said the US trade deficit narrowed to 58.8 bln usd in December from 63.1 bln a month earlier. Thomson IFR Markets' consensus expectation was for a more modest reduction to 61.6 bln usd.

At 1.42 pm, the dollar had strengthened to 1.4616 per euro from 1.4630 prior to the data, and to 1.9708 per pound from 1.9721 previously.

chinny.li@thomson.co

S&P 500 futures get a lift after jobless claims data, Nasdaq 100 futures dip

2008-02-14T06:16:00.000-08:00

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Thu, Feb 14 2008, 14:00 GMT
http://www.afxnews.com

NEW YORK (Thomson Financial) - U.S. stock futures had a mixed reaction to data showing that weekly jobless claims fell more than expected.

S&P 500 futures rose 4.80 points to 1,368.00 and Nasdaq 100 futures gained 7.25 points to 1,827.50.

Just prior to the release of jobless claims data, S&P 500 futures were trading around 1,364.50 and Nasdaq 100 futures were around 1,828.

The U.S. Labor Department said first-time claims for state unemployment insurance fell 9,000 during the week ending Feb. 9 to 348,000, compared with the median estimate of economists surveyed by IFR Markets of 343,000. The 4-week average increased by 12,000 to 347,250, the highest level since October 2005.

Tomi Kilgore

Euro Hits One-Week High Vs Dlr As Risk Aversion Declines

2008-02-14T06:15:00.000-08:00

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Thu, Feb 14 2008, 13:59 GMT
http://www.djnewswires.com/eu

Euro Hits One-Week High Vs Dlr As Risk Aversion Declines

By Dan Molinski
Of DOW JONES NEWSWIRES

NEW YORK (Dow Jones)--The euro rose to a fresh one-week high versus the dollar early Thursday in New York on reduced risk aversion, but has pared some of those gains after data showed the U.S. trade deficit narrowed sharply in December.

The U.S. trade gap decreased by 6.9% to $58.76 billion, the Commerce Department said Thursday, in spite of a record-high foreign oil price.

That pushed the euro back toward $1.4600 after it earlier reached an intra-day high of $1.4640.

Despite the euro's brief setback following the trade data, the trend is still in the single currency's favor following a sharp rise in global stocks overnight that has boosted risk appetite. That has investors favoring the higher-yielding currencies such as the euro and sterling.

Upcoming testimony by Federal Reserve Chairman Ben Bernanke on Capitol Hill may lead to an even stronger appetite for risk, and thus work to the detriment of the dollar.

He will be speaking before the Senate Banking Committee at 10 a.m. EST (1500 GMT).

Thursday morning in New York, the euro was at $1.4611 from $1.4573 late Wednesday, while the dollar was at Y108.31 from Y108.27. The euro was at Y158.19 from Y157.75. The U.K. pound was at $1.9704 from $1.9640, according to EBS, while the dollar was at CHF1.1034 from CHF1.1083 late Wednesday.

Should Bernanke indicate that the U.S. is likely to avoid a recession, this may work against the dollar versus its European rivals as investors' risk appetite would grow and they would therefore seek out higher-yielding currencies.

"We doubt he alone will diminish the recent rise in risk appetite that is aiding the current trends in the foreign exchange market," said Robert Lynch, currency strategist at HSBC in New York. "And if we're right about that, then the current push higher in sterling versus dollar and euro versus dollar can continue."

Meanwhile, the increased risk appetite has allowed the dollar to further its advance against the yen from earlier in the week, and it recently touched a fresh one-month high of Y108.43.

-By Dan Molinski, Dow Jones Newswires; 201-938-2245; dan.molinski@dowjones.com

(END) Dow Jones Newswires

Metals - Aluminium holds onto gains amid South African power crisis

2008-02-14T06:14:00.002-08:00

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Thu, Feb 14 2008, 13:58 GMT
http://www.afxnews.com

LONDON (Thomson Financial) - Aluminium held onto gains after the chief executive of South African power utility Eskom confirmed proposals are under way to buy back significant amounts of power from industrial customers.

Although CEO Jacob Maroga did not mention the impact on aluminium smelters, an Eskom source told Reuters last night the utility is considering a complete power-supply buy-back from three smelters for 2008.

The smelters at risk include BHP Billiton's Bayside and Hillside operations in South Africa, as well as the Mozal smelter in Mozambique. Together, the three smelters produce around 1.5 mln tonnes of aluminium a year.

At 1.37 pm, LME aluminium for 3 month delivery was up at 2,778 usd a tonne against 2,691 usd at the close yesterday, having earlier touched 2,825 usd a tonne, its best level since late July.

Analysts at Standard Bank said while a total power-supply buy-back in South Africa is unlikely, "some power restrictions are inevitable". They noted also reports that Rio Tinto might delay or postpone its Coega smelter.

South Africa is currently in the midst of a power supply crisis that last month sparked a five-day closure of mines and smelters and a round of blackouts across the country.

Aluminium smelting is extremely energy intensive but not very labour intensive and Eskom believes it is an obvious industry to target in its attempt to increase South Africa's generation capacity as soon as possible.

Elsewhere, the LME said in a daily report aluminium stocks held in its warehouse fell by 1,825 tonnes to total 956,075 tonnes. The fall underlined the market's supply worries, boosting aluminium prices.

Although overall aluminium stock levels are not low as yet, the market fears they could trend down going forward, especially if the South African power crisis worsens.

In China, where smelter output has also been constrained by power outages and by severe weather conditions, the market estimates up to 650 tonnes of Chinese aluminium could be lost.

In other metals, three-month copper was down at 7,725 usd a tonne against 7,780 usd, amid renewed worries over the move by Chinese players returning from new year holidays to hold back on buying.

Fairfax analyst Marc Elliot said there are reports the Chinese are "holding out for lower prices in anticipation of shipments due which will improve availability".

In addition, the metal is under pressure from speculation data out tomorrow that will show copper inventories in warehouses monitored by the Shanghai Futures Exchange rose by 10,000 tonnes or 50 pct in the week to today.

Offsetting this, however, are ongoing falls in LME stocks.

The LME said in a daily report copper stocks in its warehouses fell again, this time by 2,950 tonnes to 154,650 tonnes. Overall stocks are at their lowest since last October.

The stock falls have been underpinning copper for much of this year, overshadowing worries that demand will wane if the US economic growth slowdown worsens.

In other metals traded, tin fell to 17,050 usd a tonne against 17,200 usd, nickel dropped to 27,650 usd against 28,000 usd, zinc fell to 2,390 usd against 2,415 usd and lead edged up to 3,050 usd against 3,030 usd.

maytaal.angel@thomson.com

ma/wj

COPYRIGHT

Canada Dec trade surplus deteriorates to 2.4 bln cad, worst in nine years

2008-02-14T06:14:00.001-08:00

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Thu, Feb 14 2008, 13:57 GMT
http://www.afxnews.com

LONDON (Thomson Financial) - Canada's trade surplus with the rest of the world deteriorated to its lowest level in over nine years in December, as the country suffered the effects of a strong currency, data from Statistics Canada showed.

The surplus fell to 2.4 bln cad, its lowest level since November 1998. For 2007 as a whole, the surplus narrowed to 49.7 bln cad from 51.3 bln, the lowest level since 1999.

This is well below the forecast of analysts polled by Thomson IFR Markets for a surplus of 3.2 bln cad.

Total exports during the month fell 3.1 pct to 36.7 bln cad, while imports edged up 0.7 pct to 34.3 bln cad, the figures showed.

jessica.mortimer@thomson.com

jkm/lht

COPYRIGHT

Canada Dec trade surplus deteriorates to 2.4 bln cad, worst in nine years

2008-02-14T06:13:00.001-08:00

CORRECT: US weekly jobless claims down 9,000 to 348,000

2008-02-14T06:07:00.000-08:00

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Thu, Feb 14 2008, 13:56 GMT
http://www.afxnews.com

(corrects comparison with economist estimate of first-time claims)

WASHINGTON (Thomson Financial) - The number of people filing new claims for unemployment insurance fell for the second week in a row while the four-week moving average for initial claims rose to its highest level in over two years, the Labor Department said today.

The number of first-time claims filed in the week ending Feb. 9 fell by 9,000 to 348,000. That compares with the 343,000 claims economists polled by Thomson's IFR Markets had expected.

The four-week moving average for initial claims increased by 12,000 to 347,250, the highest level since October 2005.

Economists prefer the four-week moving average because it smoothes out fluctuations in the weekly data.

For the week ending Feb. 2, the number of individuals continuing to receive unemployment insurance fell by 9,000 to 2.761 million, below the 2.780 million claims economists had expected.

The four-week moving average for continuing claims rose by 3,500 to 2.728 million, the highest level since November 2005.

corbett.daly@thomson.com+tessa.moran@thomson.com

Dollar Forward Rates

2008-02-14T05:03:00.000-08:00

ForexFc Forex Making Money Online News Collection

Thu, Feb 14 2008, 12:37 GMT
http://www.afxnews.com

LONDON (Thomson Financial) -

New York

1 mth 34.92 - 34.17 prm

3 mths 119.45 - 118.45 prm

6 mths 249.70 - 248.20 prm

12 mths 487.25 - 484.25 prm

TFN.newsdesk@thomson.com

tda/ssa

Afternoon Interbank Intercurrency

2008-02-14T05:02:00.002-08:00

ForexFc Forex Making Money Online News Collection

Thu, Feb 14 2008, 12:37 GMT
http://www.afxnews.com

LONDON (Thomson Financial) -

(Rates supplied by Barclays Intl)

CANADA

TOM/NEXT 4.00 - 4.10

7 DAY 4.00 - 4.10

1 MTH 4.00 - 4.10

3 MTHS 3.80 - 3.90

6 MTHS 3.75 - 3.85

12 MTHS 3.65 - 3.75

JAPAN

TOM/NEXT 0.52 - 0.57

7 DAY 0.51 - 0.56

1 MTH 0.58 - 0.63

3 MTHS 0.85 - 0.90

6 MTHS 0.89 - 0.94

12 MTHS 1.00 - 1.05

STERLING

TOM/NEXT 5.27 - 5.32

7 DAY 5.29 - 5.34

1 MTH 5.47 - 5.55

3 MTHS 5.57 - 5.65

6 MTHS 5.51 - 5.59

12 MTHS 5.35 - 5.45

EURO

TOM/NEXT 3.98 - 4.02

7 DAY 4.05 - 4.09

1 MTH 4.13 - 4.18

3 MTHS 4.29 - 4.35

6 MTHS 4.28 - 4.34

12 MTHS 4.28 - 4.34

TFN.newsdesk@thomson.com

India's Jan edible oil imports surge 46 pct year on year to 457,601 tonnes

2008-02-14T05:02:00.001-08:00

ForexFc Forex Making Money Online News Collection

Thu, Feb 14 2008, 12:21 GMT
http://www.afxnews.com

MUMBAI (Thomson Financial) - India's edible oil imports for the month of January surged 46 pct to 457,601 tonnes on higher domestic demand and expectations of lower winter crop yield.

"This surge can be attributed to rise in demand on higher per-capita consumption, growing by 3-4 pct, and also on expectations of lower winter crop," said BV Mehta, executive director at the Solvent Extractors Association Of India.

Palm oil imports rose to 373,851 tonnes from 269,282 tonnes, the trade body said in a statement.

The overall import of edible oil during the first three months of the current oil year starting November has marginally increased by 16 pct to 1.08 mln tonnes from 932,214 tonnes.

India imported 4.71 mln tonnes of edible oil in the 12 months to end-Oct 2007, compared with about 4.42 mln tonnes the year earlier.

Total first-quarter vegetable oil imports -- edible and non-edible -- rose 14 pct to 1.25 mln tonnes, comprising 1.08 mln tonnes of edible oil and 164,738 tonnes of non-edible oil.

Meanwhile, the ministry of agriculture estimates the country's 2007-08 oilseeds production to rise to 27.16 mln tonnes compared with 24.29 mln tonnes in the year ago period.

tfn.newsdesk@thomson.com

Ahead of the Bell: Trade Balance

2008-02-14T05:01:00.000-08:00

ForexFc Forex Making Money Online News Collection

Thu, Feb 14 2008, 12:00 GMT
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WASHINGTON (AP) - Wall Street economists expect government data to be released Thursday will show that the U.S. trade deficit declined slightly in December from the previous month, due to increased exports and slightly lower oil prices.

The gap between U.S. imports and exports is forecast to drop to $61.6 billion in December from $63.1 billion in November, according to a consensus estimate of Wall Street economists surveyed by Thomson/IFR.

The Commerce Department is scheduled to release its monthly report on international trade in goods and services, based on documents from U.S. Customs and Border Protection, at 8:30 am EST.

"We anticipate some reacceleration in export volumes, after several months showing little change," economists from Global Insight, a consulting firm, said on the company's Web site. "The foreign trade sector remains a crucial support for the U.S. economy, as domestic spending fades."

Several companies have cited exports as a crucial source of revenue in recent months. Arch Coal Inc. said earlier this month that its coal exports grew by 10 million tons in 2007, and it expects at least another 20 million ton increase in 2008.

Nike Inc. in December credited exports and international sales with boosting its profits 10 percent in the quarter ended Nov. 30.

Economists at Nomura Securities, meanwhile, said a moderation in oil prices in December may help keep imports in check.

The November trade gap increased more than expected, with exports rising only $600 million to $142.3 billion while imports jumped $6 billion to $205.4 billion.

ICE US Equity & Currency Closing Estimated Volumes For Feb 13

2008-02-14T05:00:00.000-08:00

ForexFc Forex Making Money Online News Collection

Thu, Feb 14 2008, 12:00 GMT
http://www.djnewswires.com/eu

ICE US Equity & Currency Closing Estimated Volumes For Feb 13

Estimated Volume Report for 13-Feb-2008

Commodity Floor Electronic Call Put Total
Futures Futures Options Options Options
FINEX
AUS$/US $ 0 0 0 0 0
Aus. Dollar - N.Z. Dollar 0 0 0 0 0
Australian $-Canadian $ 244 0 0 0 0
U.S. Dollar - Aus. Dollar 11 32 0 0 0
Brazilian Real-US $ 0 0 0 0 0
Colombian peso-US Dollar 0 0 0 0 0
U.S. DOLLAR INDEX 536 955 150 29 179
Euro Index 0 0 0 0 0
EURO-Japanese Yen 99 34 0 0 0
EURO - US $ 24 256 0 0 0
Euro-Canadian Dollar 87 3 0 0 0
EURO - US $ 0 0 0 0 0
EURO - CZECH KORUNA 34 0 0 0 0
Euro - Sterling 222 86 0 0 0
Pound Sterling-N Z.Dollar 0 0 0 0 0
EURO - HUNGARIAN FORINT 0 101 0 0 0
Canadian $-Japanese Yen 0 13 0 0 0
Swedish Krona-Japanese Yen 0 0 0 0 0
U.S.$-Swedish Krona 78 0 0 0 0
US dollar/Swedish Krona 0 0 0 0 0
Norway Krone -Japanese Yen 0 0 0 0 0
Small US$-Swiss Franc 91 0 0 0 0
Sm.British Pound-US$ 2 41 0 0 0
Norwegian/Swedish 0 0 0 0 0
U.S.$-Norwegian krone 33 0 0 0 0
US dollar/Norwegian Krone 0 0 0 0 0
Euro-Norwegian Krone 92 28 0 0 0
POUND STERLING-CANADIAN $ 0 0 0 0 0
POUND-NORWEGIAN KRONE 0 0 0 0 0
Pound Sterling-Sw. Krona 0 0 0 0 0
Pound Sterling-S.A. Rand 0 0 0 0 0
Pound-Australian $ 30 5 0 0 0
Euro-Australian Dollar 81 1 0 0 0
Euro-SWEDISH KRONA 46 2 0 0 0
Euro - Swiss Franc 638 199 0 0 0
Small US$-Japanese Yen 199 102 0 0 0
BRITISH POUND-SWISS FRANC 37 0 0 0 0
Small US $-Canadian $ 0 7 0 0 0
BRITISH POUND-JAPANESE YEN 50 38 0 0 0
US $-HUNGARIAN FORINT 259 0 0 0 0
US $-CZECH KORUNA 15 0 0 0 0
US dollar/Czech Koruna 0 0 0 0 0
US $/Hungarian Forint 0 0 0 0 0
Australian $-Japanese Yen 99 2 0 0 0
U.S.Dollar - Canadian 0 0 0 0 0
U.S.Dollar - Swiss Franc 0 0 0 0 0
U.S.Dollar - British Pound 0 0 0 0 0
BRITISH STERLING/YEN 0 0 0 0 0
U.S.Dollar - Japanese Yen 0 0 0 0 0
EURO-South African Rand 0 0 0 0 0
NZ$ / US$ 0 0 0 0 0
New Zealand $-Japanese Yen 0 0 0 0 0
U.S. Dollar-S.African Rand 150 6 0 0 0
U.S. Dollar - N. Z. Dollar 53 10 0 0 0
SWISS FRANC-Japanese Yen 4 0 0 0 0

INDEXES
CONTINUOUS COMMODITY INDEX 12 0 0 2 2
RJ CRB INDEX 0 0 0 0 0
Russell 1000 Growth Index 0 0 0 0 0
Russell 2000 Growth 0 0 0 0 0
Small NYSE Comp Index 0 0 0 0 0
Russell 1000 0 27 0 548 548
Russell 1000 Mini 0 442 0 0 0
Russell 2000 Mini Index 0 271 0 0 0
Russell 3000 0 0 0 0 0
Russell 2000 Index 0 0 22 181 203
Russell 2000 Value 0 0 0 0 0
Russell 1000 Value 0 0 0 0 0
NYSE Comp Index 0 0 0 0 0

-By Linda Rice; Dow Jones Newswires; 913-322-5173;
csstat@dowjones.com

Ahead of the Bell: Unemployment Benefits

2008-02-14T04:59:00.000-08:00

ForexFc Forex Making Money Online News Collection

Thu, Feb 14 2008, 11:59 GMT
http://www.afxnews.com

WASHINGTON (AP) - Government data due out Thursday is forecast to show that initial claims filed for unemployment benefits fell last week for the second straight period.

Wall Street economists surveyed by Thomson/IFR expect claims fell by 13,000 to 343,000 for the week ended Feb. 9. The Department of Labor is scheduled to release the data at 8:30 a.m. EST.

Last week, applications for unemployment benefits fell by 22,000 to 356,000. The drop was not as steep as analysts had expected and reinforced concerns that the labor market was starting to show symptoms of a recession.

The government's four-week moving average of new claims, which smooths out week-to-week fluctuations, rose by 8,500 to 335,000 for the week ended Feb. 2, the highest level in a month.

Corporate job cuts announced this week include:

-- Morgan Stanley on Wednesday said it will cut 1,000 jobs as the nation's second-largest investment bank trims its residential mortgage operations.

-- Hit with its biggest loss in its 100-year history, automaker General Motors Corp. announced a new round of buyouts to all 74,000 of its U.S. hourly workers represented by the United Auto Workers.

-- Sears Holdings Corp., which owns the Kmart and Sears retail chains, said it is cutting about 200 jobs at its Hoffman Estate, Ill., headquarters to bring overhead costs in line with falling sales.

-- Biopharmaceutical company Nektar Therapeutics said it cut about 150 employees as part of a restructuring plan.

Zimbabwe's inflation surges to 66,000 pct

2008-02-14T04:58:00.000-08:00

ForexFc Forex Making Money Online News Collection

Thu, Feb 14 2008, 11:58 GMT
http://www.afxnews.com

HARARE (Thomson Financial) - Zimbabwe's inflation rate, already the highest in the world, has soared to a new high of 66,212.3 pct, according to official figures obtained by AFP.

"The year-on-year inflation rate for the month of December 2007, as measured by the all items Consumer Price Index (CPI) stood at 66,212.3 pct, gaining 39,714.5 percentage points on the November rate of 26,740.8 pct," the Central Statistical Office (CSO) said in a statement, released to banks.

"This means that prices as measured by the all items CPI, increased by an average 66,212.3 pct between December 2006 and December 2007."

CSO said food and non-alcoholic beverages inflation was at 79,412.0 pct in December while non-food inflation was 58,492.9 pct.

The month-on-month inflation rate in December 2007 was 240.1 gaining 108.7 percentage points on the November 2007 rate of 131.4 pct, the CSO said.

The CPI for December 2007, stood at 414,490,130.8 compared to 129,826,060.8 in November 2007 and 665,774.1 in December 2006, CSO said.

The government has introduced several measures to rein in inflation including imposing a ceiling on prices of some goods and services and knocking off three zeros from the country's currency.

tf.TFN-Europe_newsdesk@thomson.com

afp/ejb/lht

UPDATE: Daimler: Hedged Around 70% Of Currency Risks In 2008

2008-02-14T04:57:00.002-08:00

Thu, Feb 14 2008, 11:55 GMT
http://www.djnewswires.com/eu

UPDATE: Daimler: Hedged Around 70% Of Currency Risks In 2008

(Updates with additional CFO comment.)

STUTTGART -(Dow Jones)- Daimler AG's (DAI) Chief Financial Officer Bodo Uebber said Thursday that the German automaker has hedged around 70% of its exposure to unfavorable exchange rates, especially the U.S. dollar, in 2008.

Speaking at a press conference in Stuttgart, Uebber said the hedging rate for 2009 is currently at 40%.

Uebber said Daimler's overall dollar exposure is currently around EUR10 billion.

Company Web site: www.daimler.com

-By Christoph Rauwald, Dow Jones Newswires; +49 69 29 725 512; christoph.rauwald@dowjones.com

(END) Dow Jones Newswires
ForexFc Forex Making Money Online News Collection

Shanghai banks' January new yuan loans 61 bln yuan, almost double year earlier

2008-02-14T04:57:00.001-08:00

ForexFc Forex Making Money Online News Collection

Thu, Feb 14 2008, 11:50 GMT
http://www.afxnews.com

SHANGHAI (XFN-ASIA) - Financial institutions in Shanghai added 61 bln yuan in yuan loans in January, up 31.42 bln yuan from the same month last year, the Shanghai bureau of the People's Bank of China said in a statement.

Shanghai's financial institutions lost 47.48 bln yuan in yuan deposits in January, 40.37 bln yuan more than a year earlier, it said.

Corporate yuan deposits decreased by 53.72 bln yuan while individual savings dropped by 18.89 bln yuan.

Financial institutions lost 49.93 bln yuan in corporate yuan demand deposits, while individual demand deposits decreased by 9.04 bln yuan, the central bank said.

In late December, the central bank cut the annual rate on bank demand deposits by 0.09 percentage point to 0.72 pct as it raised most other rates.

Corporate foreign currency fixed deposits fell by 372 mln usd in January, while US dollar savings decreased by 700 mln usd from January 2007.

At the end of January, yuan and foreign currency deposits in Shanghai totalled 2.98 trln yuan, up 13.5 pct year-on-year.

Yuan and foreign currency loans totaled 2.24 trln yuan at the end of the month, up 18.8 pct.

( 1 usd = 7.2 yuan )

shburo@xfn.com

Thai consumer confidence rises in January - survey

2008-02-14T04:56:00.002-08:00

ForexFc Forex Making Money Online News Collection

Thu, Feb 14 2008, 11:49 GMT
http://www.afxnews.com

BANGKOK (Thomson Financial) - Thai consumer confidence rose in January, marking the third consecutive increase on hopes the country's newly elected government would take measures to boost the economy, researchers said Thursday.

The consumer confidence index edged up to 78.1 from 77.3 in December, the University of the Thai Chamber of Commerce said.

"People have hope that the new government will do something to support the economy," pollster Thanawat Phonvichai said in a statement.

Thailand's new Prime Minister Samak Sundaravej formed a cabinet earlier in the month, with lifting the country's sluggish economy as one of its top priorities.

While consumer confidence is showing improvement, the index has spent 43 months below 100, meaning that pessimists outnumber optimists, the pollsters said.

"Consumers remain worried about inflation and rising global oil prices," Thanawat said.

Fears over a recession in the United States, Thailand's largest trading partner, also pressured sentiment as exports are a key driver of the kingdom's economy, he said.

The index is based on a survey of 2,242 people nationwide.

afp

zr/zr

Finnish December GDP down 0.7 from Nov; up 2.3 pct year-on-year

2008-02-14T04:56:00.001-08:00

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HELSINKI (Thomson Financial) - Finland's economy grew by just 2.3 pct in December, its slowest rate of growth in 2007, with GDP contracting on a month-on-month basis, official figures show.

Statistics Finland said total output fell 0.7 pct from November.

The year-on-year slowdown was in part due to a 3 pct decline in output in the wood and paper industry, and a slowdown in the rate of growth in the construction industry to 1 pct.

A decline in motor vehicle sales owing to changes in car tax rules was also a factor.

Output rose 4 pct in the metal industry and by 10 pct in the energy supply sector.

james.etheridge@thomson.com

je/jrr

-2nd UPDATE: French 4Q 07 GDP Slows To 0.3% QQ On Inventories

2008-02-14T04:55:00.001-08:00

hu, Feb 14 2008, 11:44 GMT
http://www.djnewswires.com/eu

-2nd UPDATE: French 4Q 07 GDP Slows To 0.3% QQ On Inventories

(Adds economist quotes.)

By Gabriele Parussini
Of DOW JONES NEWSWIRES

=======================================================!
Preliminary 4Q 2007 GDP !
4Q 3Q !Consensus: +0.3% on qtr !
On qtr +0.3% +0.8% ! +2.1% on yr !
On yr +2.1% +2.2% !Actual: +0.3% on qtr !
! +2.1% on yr !
=======================================================!

PARIS (Dow Jones)--The French economy slowed as expected in the fourth quarter of last year, the national statistics institute Insee said Thursday, as French companies depleted inventories instead of boosting production.

French gross domestic product grew 0.3% in the three months to Dec. 31, and was 2.1% higher than a year earlier, as expected, preliminary figures released Thursday by Insee showed.

GDP growth for the whole of 2007 was 1.9%, data showed, down from the 2.2% increase posted in 2006.

A Dow Jones Newswires survey of economists had forecast fourth-quarter growth of 0.3% on the quarter and 2.1% on the year.

"The bulk of the GDP deceleration came from inventories, which shaved 0.4 percentage point from growth," Tullia Bucco, an economist at Unicredit said. "Destocking was very much stronger than we expected."

French economic growth picked up more than initially estimated in the third quarter of last year, expanding 0.8% on the previous three-month period, its fastest rate of growth in more than a year and well above second-quarter growth of 0.3%, Insee data showed in December.

Annual growth in the third quarter was 2.2%, up from 1.4% in the previous three-month period.

In November, the central bank revised its forecast for fourth-quarter growth down to 0.5% from 0.6%, bringing its average annual growth estimate for 2007 down to 1.9%, below the government's 2%-2.5% growth estimate.

Slowing growth may pose a problem for President Nicolas Sarkozy, who was elected in June on a pledge to revive the economy and increase France's potential GDP growth rate - currently estimated at 2% a year - by one percentage point.

The slowdown in growth in the last quarter of 2007 is expected to continue well into 2008.

"We maintain our scenario of a relatively significant dip in activity in the first half of 2008," said Jean-Christophe Caffet, an economist at Natixis. "French GDP growth should thus not exceed 1.6% this year."

Insee said that growth in December would slow gradually in the first half of this year, with GDP expected to rise 0.5% in the first quarter and by 0.4% in the second quarter.

The statistics agency noted that the euro's appreciation is likely to hamper exports in early 2008. Business investment will probably slow due to tighter financing conditions and weaker foreign demand, and only consumption is expected to continue to grow and keep the economy going. Unemployment is expected to reach a record low of 7.7% in the first half of this year, Insee said.

In the last quarter of 2007, production of goods was unchanged, as a fall in manufacturing output was offset by an increase in power production. Exports suffered, falling 0.6% from the previous quarter, but an even stronger decline in imports, which fell 1.5%, resulted in the external sector contributing 0.2 percentage point to GDP growth.

Economists said there is a clear split between the domestic and foreign sectors.

"Domestic demand contributed 2.2 percentage points to GDP growth, while foreign trade shaved 0.3 percentage point" from the final result, said Nicolas Bouzou, of think tank Asteres. "Private consumption is the main interrogation point for 2008 growth."

"We expect GDP growth to be revised down as final data are published," Marc Touati, analyst at Global Equities said. "Fourth-quarter growth has been salvaged by imports, which still fell by 1.4%. Despite the massive increase in the foreign trade gap in the last three months of 2007, the foreign sector gave a positive contribution to growth on the period."

Insee Web site: http://insee.fr

-By Gabriele Parussini, Dow Jones Newswires; +331 40171740; gabriele.parussini@dowjones.com

(END) Dow Jones Newswires

February 14, 2008 06:44 ET (11:44 GMT)

Copyright 2008 Dow Jones & Company, Inc.

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ECB says use of asset backed securities as collateral eased liquidity problems

2008-02-14T04:54:00.000-08:00

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FRANKFURT (Thomson Financial) - The European Central Bank said its acceptance of asset backed securities as collateral at its money market refinancing operations has helped limit liquidity problems in financial markets.

The ECB accepts a wide range of collateral at its refinancing operations, including mortgage backed securities, prompting some concerns that it could be bailing out banks facing losses in the US subprime market.

But the central bank said the acceptance of a broad range of collateral has simply helped markets function more smoothly.

"The wide acceptance of high quality collateral in the Eurosystem's credit operations has probably helped indirectly to mitigate liquidity problems in a number of market segments," the ECB said in its February monthly bulletin.

Asset backed securities account for a growing share of the collateral accepted at the refinancing operations, reaching 215 bln eur or 17 pct of total collateral at end-September, it said.

ECB president Jean-Claude Trichet said last week that the ECB and the US Federal Reserve have both seen an increase in the proportion of such securities in the collateral offered by banks, but this does not in any way mean that banks with financial difficulties are being bailed out.

"All of us, on both sides of the Atlantic, have noted a relative increase in the use of collateral in the form of private paper and a relative decrease in the use of paper in the form of Treasury bills," he told last week's ECB news conference.

"I would not say in any respect, on either side of the Atlantic, that institutions are being bailed out. Institutions are regularly making losses, as you can see. So they have their losses and they take their losses, and we are certainly not bailing everybody out," he said.

Asset backed securities have always been eligible as collateral at ECB operations providing they meet the general criteria for acceptable collateral, although some specific additional criteria for asset backed securities were added in 2006.

"The criteria for eligible collateral were purposely designed to be rather general, focusing on the objective qualities of the asset and issuer, so as to ensure that the various risks to the central bank are sufficiently low, as well as to be neutral towards financial market developments," the ECB said.

steve.whitehouse@thomson.com

sw/rfw

COPYRIGHT

Daimler Hedged Around 70% Of Currency Risks In 2008 - CFO

2008-02-14T04:53:00.000-08:00

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Daimler Hedged Around 70% Of Currency Risks In 2008 - CFO

STUTTGART -(Dow Jones)- Daimler AG's (DAI) Chief Financial Officer Bodo Uebber said Thursday that the German automaker has hedged around 70% of it's exposure to unfavorable exchange rates, especially the U.S. dollar, in 2008.

Speaking at a press conference in Stuttgart, Uebber said the hedging rate for 2009 is currently at 40%.

Company Web site: www.daimler.com

-By Christoph Rauwald, Dow Jones Newswires; +49 69 29 725 512; christoph.rauwald@dowjones.com

(END) Dow Jones Newswires

February 14, 2008 06:42 ET (11:42 GMT)

Daimler Hedged Around 70% Of Currency Risks In 2008 - CFO

2008-02-14T04:50:00.002-08:00

Lithuanian Jan CPI +1.6% On Month, +9.9% On Year

2008-02-14T04:50:00.001-08:00

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Lithuanian Jan CPI +1.6% On Month, +9.9% On Year

DOW JONES NEWSWIRES

Lithuania's consumer price index increased 1.6% on the month and was 9.9% higher on the year in January, Statistics Lithuania said Thursday.

In December, the index rose 0.5% from the month earlier and 8.1% on the year-earlier period.

Housing, water, electricity, gas and other fuel prices rose by 4.8% since December, while transport goods and services rose 3.7% and food prices increased 1.9%, the national statistics agency said.

Clothing and footwear prices fell 5.7% on the month.

Danske Bank said the January on-year rate was much higher than expected - it had forecast 9%.

Agency Web site: www.stat.gov.lt

-By Joel Sherwood, Dow Jones Newswires; +46 85 45 13 092; joel.sherwood@dowjones.com

(END) Dow Jones Newswires

February 14, 2008 06:25 ET (11:25 GMT)

Spain's Solbes sees GDP growth potential closer to 3.5 pct than 3.0 pct

2008-02-14T04:49:00.001-08:00

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MADRID (Thomson Financial) - Spain's Economy Minister Pedro Solbes said he sees the country's GDP growth potential closer to 3.5 pct than 3.0 pct, but did not specify a time frame.

Speaking at the Forum Europa in Madrid, Solbes said Spain's current economic slowdown will be "short", and economic difficulties "minor" thanks to improving fundamentals.

Earlier, the National Statistics Institute said preliminary fourth quarter GDP rose 0.8 pct from the third quarter and was up 3.5 pct from a year earlier.

Solbes noted that the quarter-on-quarter growth rate is "not a bad figure".

In December, the Spanish government revised its full-year GDP estimates to 3.1 pct from 3.3 pct.

Solbes said the revision takes all elements of the current global economic situation into account.

tfn.europemadrid@thomson.com

Putin: Recognizing Kosovo's Independence "Immoral, Illegal"

2008-02-14T04:48:00.001-08:00

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Putin: Recognizing Kosovo's Independence "Immoral, Illegal"

MOSCOW (AP)--Russian President Vladimir Putin said recognizing an independence declaration by Kosovo would be "immoral and illegal," and European countries supporting the region's bid to break away from Serbia should be "ashamed" of double standards.

"I will yet again emphasize that we consider that unilateral support for independence for Kosovo is immoral and illegal," Putin told an annual news conference in the Kremlin. "I don't want say anything that would offend anyone, but for 40 years northern Cyprus has practically had independence.

"Why aren't you recognizing that," he asked. "Aren't you ashamed, Europeans, for having these double standards?"

(END) Dow Jones Newswires

February 14, 2008 06:07 ET (11:07 GMT)

UPDATE: Euro-Zone Growth Halves In 4Q Vs 3Q, +0.4% On Qtr

2008-02-14T04:47:00.001-08:00

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UPDATE: Spain Min Sees Debate On ECB Reaction To Financial Crisis

(Adds further comments from finance minister.)

MADRID -(Dow Jones)- Spanish Finance Minister Pedro Solbes Thursday said he sees a debate forming in the euro zone over whether the European Central Bank should react to counter the economic impact of financial market turmoil.

"There is a debate over whether monetary policy should respond to the financial turmoil we are seeing," Solbes said at a meeting with journalists and business leaders.

While the U.S. Federal Reserve has aggressively moved to lower interest rates to stimulate economic activity in the face of the subrprime mortgage crisis, the ECB has kept its interest rates on hold.

Solbes also said Spanish banks have an "enviously" healthy position in the liquidity crunch precipitated by the subprime mortgage crisis and that their use of the ECB's liquidity facilities is porportional to Spain's weight in the euro-zone economy.

The finance minister said the international financial crisis is having a larger impact on the Spanish economy than he had originally forecast. Nonetheless, the Spanish economy grew at around 3.8% in 2007, according to an estimate published earlier Thursday by the National Statistics Instititute.

Solbes said soaring Spanish inflation, which has spiked on higher international oil and food prices, should ease in the second half of 2008.

Solbes said European Union finance ministers discussed at their monthly meeting earlier this week whether or not to follow the U.S. lead of using fiscal measures to boost slowing economic growth. He said the ministers had come to the conclusion that stimulus should be used only as individual countries' cyclical and budgetary situations permit.

In the case of Spain, Solbes said the country has a healthy budget surplus of EUR20 billion, equal to over 2% of the country's gross domestic product.

The finance minister said his government could "possibly accelerate" public spending problems that are already in place and would bolster its so-called active employment programs which help place out-of-work job seekers in new jobs.

Solbes said he was against "execessive" or "poorly thought out" public expenditure to bolster economic activity.

-By Jonathan House, Dow Jones Newswires; +34 619 93 39 52; jonathan.house@dowjones.com

(END) Dow Jones Newswires

February 14, 2008 05:58 ET (10:58 GMT)

EU Probes State Support For Cos In Germany's Saxony Region

2008-02-14T04:42:00.000-08:00

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EU Probes State Support For Cos In Germany's Saxony Region

BRUSSELS -(Dow Jones)- The European Commission Thursday said it is investigating a financing scheme for companies planned by the government in Germany's Saxony region.

The commission said it doubts whether the planned support, which will guarantee working capital loans, is in line with European Union rules governing state subsidies to business.

"The scheme seems to provide guarantees to all companies in Saxony," the commission's top antitrust official Neelie Kroes said in a statement.

Under E.U. rules, state subsidies to business can only be used in cases where they support jobs in poorer regions and don't unfairly distort competition among companies.

-By Adam Cohen, Dow Jones Newswires; +322 741 1486; adam.cohen@dowjones.com

(END) Dow Jones Newswires

February 14, 2008 06:00 ET (11:00 GMT)

Mexico's Peso Closes Stronger At 10.7405/Dlr On US Data

2008-02-13T16:07:00.000-08:00

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Mexico's Peso Closes Stronger At 10.7405/Dlr On US Data

By Anthony Harrup

Of DOW JONES NEWSWIRES

MEXICO CITY (Dow Jones)--Mexico's peso strengthened against the dollar Wednesday as local stocks rose on a surprise increase in U.S. retail sales in January.

The peso was steady for most of the session, closing in Mexico City at MXN10.7405 to the dollar, compared with MXN10.7460 at the opening and MXN10.7575 at Tuesday's close.

Stocks rose after the U.S. Commerce Department reported an unexpected 0.3% rise in retail sales last month. The local market's IPC index was up 1.2%, backed by U.S. equities gains.

Local government bonds ceded some ground, pushing yields higher.

The yield on bonds due 2016 was up 2 basis points from the previous close at 7.53%, but off its intraday high of 7.59%. The yield on bonds maturing in 2024 was up 2 basis points to 7.64% after rising to 7.68% earlier.

The peso has firmed in the past week since the Bank of Mexico reported below-estimate inflation for January, increasing expectations that the central bank will cut interest rates this year.

Nonetheless, analysts widely expect the central bank to leave the overnight rate at 7.5% at this Friday's monthly policy meeting.

-By Anthony Harrup, Dow Jones Newswires; (5255) 5080 3450; anthony.harrup@dowjones.com

(END) Dow Jones Newswires

February 13, 2008 15:28 ET (20:28 GMT)

Bolivia To Move Some Brazil Gas To Argentina,Up Output-Report

2008-02-13T16:05:00.000-08:00

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Bolivia To Move Some Brazil Gas To Argentina,Up Output-Report

BRASILIA (Dow Jones)--Bolivia will shift some of its natural gas exports to Argentina from Brazil to meet winter demand and seek to raise gas production by up to 3 million cubic meters per day by year's end, Bolivian Vice President Alvaro Garcia Linera said Wednesday, according the Estado news agency.

Linera said Bolivia would guarantee "historic" supply levels of between 27 million and 29 million cubic meters of gas per day to Brazil but may fail to meet contractually promised supplies of 30 million cubic meters per day.

"It's likely that during the winter months supplies to Argentina could rise somewhat," he said. "The question is whether we will be able to meet this demand."

Linera made the declarations following a meeting Wednesday with Brazilian President Luiz Inacio Lula da Silva.

Lula is scheduled to meet with Bolivian President Evo Morales and Argentine President Cristina Fernandez later this month to further discuss the matter of gas supplies.

Linera on Wednesday said that Bolivia had planned at least $1.1 billion in investments in the gas sector this year and hoped to raise its output 3 million cubic meters daily by October.

Gas supplies to Brazilian industry and thermal-electric production have been pressured over the past year by production difficulties in Bolivia.

In addition to energy-supply matters, Linera and Brazilian authorities Wednesday also discussed cooperation in building transportation infrastructure.

Among items on the agenda included a $400 million highway project from the Bolivian central plateau region to the Brazilian Amazon region, and the Chile-Bolivia-Brazil inter-oceanic transportation corridor aimed at linking Brazilian territory to the Pacific ocean.

-By Gerald Jeffris, Dow Jones Newswires; (5561) 3335-0832; geraldjeffris@dowjones.com

(END) Dow Jones Newswires

February 13, 2008 15:14 ET (20:14 GMT)

ECONOMIC REPORT: U.S. Inventories Rise As Sales Fall, December Data Show

2008-02-13T16:02:00.000-08:00

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ECONOMIC REPORT: U.S. Inventories Rise As Sales Fall, December Data Show

By Greg Robb

WASHINGTON (Dow Jones) -- U.S. business inventories rose 0.6% in December as sales fell 0.5%, the Commerce Department reported Wednesday.

As a result, the inventory-to-sales ratio rose to a reading of 1.26, up from 1.25 in November.

Wall Street economists had predicted inventories would rise 0.5% in the final month of 2007.

The decline in sales is the largest since January.

The monthly inventory report rarely moves financial markets, mostly because many of the numbers have been previously reported. Economists, however, find the data useful to project quarterly growth.

Already released data show a solid 0.8% rise in factory inventories and a large 1.1% rise in wholesale inventories.

Retail inventories, the only new information in the report, dipped 0.1% in December, led by a sharp 1.6% decline in the retail auto sector. This marked the biggest decline since November 2006.

Excluding motor vehicles, retail sales rose 0.7% in December, the biggest gain since May.

This raises concern that retailers will place fewer orders for new goods until their shelves empty.

The retail inventory-to-sales ratio rose to 1.30 from 1.28 in November, according to the Commerce Department's data.

"With demand uncertain, costs of capital rising and weaker profit gains, we expect further inventory liquidation in the first quarter," said the economic team at Bank of America in a report released before the data.

Business sales increased a downwardly revised 1.4% in November, while inventories rose 0.4%.

Most subcategories of sales fell in December, with the exception of general merchandise stores and food stores. Sales dropped in furniture, building materials, garden equipment and supplies.

In the past year, business inventories are up 4%, while sales are up 6%. The data aren't adjusted for price changes.

In a separate report Wednesday, the Commerce Department said U.S. retailers' sales rose 0.3% in January, a better-than-expected performance.

(END) Dow Jones Newswires

February 13, 2008 15:11 ET (20:11 GMT)

Retail sector ETF turns higher in premarket after retail sales data

2008-02-13T06:49:00.001-08:00

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Wed, Feb 13 2008, 14:36 GMT
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NEW YORK (Thomson Financial) - The Retail Holdrs ETF (RTH) swung higher in premarket trading Wednesday, with a surprise rise in retail sales providing an early lift.

The retail sector tracking stock traded at $94 ahead of the open, up 86 cents, or 0.9%, from Tuesday's close.

Just prior to the release of retail sales data, the RTH was down 24 cents, or 0.3%, at $92.90.

The U.S. Commerce Department said January retail sales rose 0.3%, vs. the median estimate of economists surveyed by IFR Markets for a decline of 0.3%. Excluding autos, sales rose 0.3% to the highest level seen since November, topping economist expectations of 0.2% growth. Sales from general merchandise stores saw a decline of 1.1%, the largest sales drop since last June.

Among the shares of individual retailers seeing early activity, Wal-Mart Stores Inc., a component of the Dow industrials, was up 0.5% at $50.50

J.C. Penney Co. was tacking on 1.7% at $49, Best Buy Co. edged up 10 cents to $47 and Abercrombie & Fitch Co. added 4 cents to $79.55.

Tomi Kilgore

Spain Fin Min Denies Plans For Real-Estate Sector Bailout

2008-02-13T06:48:00.000-08:00

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Wed, Feb 13 2008, 14:36 GMT
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Spain Fin Min Denies Plans For Real-Estate Sector Bailout

MADRID -(Dow Jones)- Spanish Finance Minister Pedro Solbes denied Wednesday local media speculation that the government would bail out the country's real-estate sector, which is suffering from a sharp slowdown in sales and tight credit conditions.

"I absolutely don't think the government should enter the real-estate sector," Solbes said at a conference in Vitoria, in northern Spain. His remarks were confirmed by a ministry spokeswoman.

The government's involvement in the sector is limited to provide EUR3 billion in guarantees for price-protected housing programs, Solbes added.

In recent weeks, Spanish media has reported that the government was in negotiations with top, Spanish real-estate companies to open a line of credit through a government entity.

The heavily indebted construction sector has been struggling since last summer's meltdown in the U.S. subprime lending market brought an abrupt tightening of credit conditions to firms in the U.S. and Europe.

Ministry Web site: http://www.minhac.es

-By Santiago Perez, Dow Jones Newswires; 34 91 395 8119; santiago.perez@dowjones.com

(END) Dow Jones Newswires

February 13, 2008 09:36 ET (14:36 GMT)

RIKSBANK WATCH: Riksbank Hikes To 4.25%, Shocking Markets

2008-02-13T06:47:00.000-08:00

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Wed, Feb 13 2008, 14:33 GMT
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RIKSBANK WATCH: Riksbank Hikes To 4.25%, Shocking Markets

By Joel Sherwood

Of DOW JONES NEWSWIRES

STOCKHOLM (Dow Jones)--Sweden's central bank surprised investors by raising its key interest rate Wednesday, insisting it had to focus on the pickup in inflation at home rather than the as yet uncertain impact of the U.S. slowdown on global economic conditions.

Investors had expected the Riksbank to leave its key rate unchanged this month, and begin cutting the rate later this year. Instead, the central bank hiked the key rate to 4.25% from 4.0%, and said it is unlikely that it will ease policy before the end of 2008.

Like many central banks, the Riksbank is confronting a pickup in the inflation rate as a result of rising energy and food prices at a time when it is unclear how severely the global economy will be affected by the slowdown in the U.S., and what impact that will have on prices over the medium term.

The Riksbank said that it had to focus on what was happening in Sweden.

"Development in the U.S. makes the outlook uncertain, but we have to make Swedish monetary policy according to Swedish conditions," said Riksbank governor Stefan Ingves. "In Sweden, there's strong inflation pressure and economic activity is strong."

Economists said the central bank is being too optimistic about how rapidly the Swedish economy will grow this year, and had failed to recognize that inflationary pressures will ease as global growth slows.

The response to the dilemma facing central bankers has varied in Europe. The Bank of England has cut its key rate twice since early December, while the European Central Bank last week indicated it is no longer considering a rate hike. However, the central banks of Poland, the Czech Republic, Romania and Serbia have all raised their key rates at their most recent policy meetings.

Investors hadn't expected the Riksbank to be in the latter group. A poll of ten economists by Dow Jones Newswires found that all expected the central bank to leave its key rate at 4.0%, despite an inflation rate well above the Riksbank's 2% target.

In fact, they anticipated rate cuts later this year, and Wednesday's decision sent market participants scrambling to reposition themselves. Sweden's currency strengthened sharply against the euro and dollar, and Swedish bond yields spiked.

"We are shocked by the Riksbank move today," said Jorgen Appelgren, a Stockholm-based economist at Nordea.

The Riksbank maintained Wednesday that although global market unrest in recent months has made the economic outlook uncertain, Sweden's economy is strong and inflationary pressures remain.

Analysts wonder whether this is the best way to interpret economic development.

"They obviously are looking were they stand rather than were they are heading," said Nordea's Appelgren. "Growth is still decent and inflation is high. But both will decline, even in the Riksbank forecast."

The Riksbank forecast Wednesday that the Swedish economy will growth by 2.4% this year and 2% next year, having expanded by 2.5% in 2007. The annual rate of inflation, which was 3.5% in December, will tick down to 3.4% this year and to 2.5% next year, it predicts.

Those forecasts are little changed from December.

Since then, however, the economic picture has turned much more gloomy, prompting the U.S. Federal Reserve to cut its key interest rate by 125 basis points. In Sweden, recent data point to weaker exports and retail sales, and a less marked improvement in the jobs market.

The Riksbank acknowledged Wednesday that the economic outlook abroad has worsened. It lowered its global growth forecast for 2008 to 4.1% from 4.5%, and cut its U.S. growth forecast to 1.7% from 2% in December.

Most Riksbank-watchers maintain that this weaker development abroad will have a bigger impact on Sweden than the Riksbank expects.

"We believe the Riksbank continues to be too optimistic in its assessment that the Swedish economy can weather the storm created by financial market turmoil and weakening global economic momentum," said Sunil Kapadia, a London-based economist at UBS.

Like many other economists, Kapadia believes the Riksbank will have to cut its key rate later this year as the full impact of the global slowdown becomes clear.

"We believe that the Riksbank will likely reverse this move, and possibly quite soon," he said.

The Riksbank makes its next rate announcement April 23.

Riksbank Web site: www.riksbank.com

-By Joel Sherwood, Dow Jones Newswires, +46 85 45 13 092, joel.sherwood@dowjones.com

Brazil's Central Bank Buys Dollars At BRL1.7449

2008-02-13T06:46:00.000-08:00

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Wed, Feb 13 2008, 14:30 GMT
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Brazil's Central Bank Buys Dollars At BRL1.7449

SAO PAULO (Dow Jones)--Brazil's Central Bank bought U.S. dollars at a snap auction Wednesday for 1.7449 reals per dollar, the bank said.

The central bank didn't reveal the volume of dollars purchased.

The bank says it is purchasing the dollars to build up foreign reserves.

The Brazilian real moved little on the auction. At 1427 GMT, the real was trading at 1.7450 to the dollar, slightly stronger than the 1.7460 quoted at 1413 GMT when the auction was called.

-By Alastair Stewart, Dow Jones Newswires; 5511-3145-1479; alastair.stewart@dowjones.com

(END) Dow Jones Newswires

February 13, 2008 09:30 ET (14:30 GMT)

Metals - Copper continues lower on muted Chinese buying

2008-02-13T06:44:00.002-08:00

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LONDON (Thomson Financial) - Copper continued lower as muted Chinese buying knocked the top off recent price gains.

Copper had risen strongly on the London Metals Exchange in the absence of Chinese markets, closed for the week-long Lunar New Year holiday until today.

But with Chinese traders returning from holiday, buying interest has been limited, with prices pushed lower as some investors chose to lock in profits.

"Price moves on the Shanghai Futures Exchange (SHFE) suggest that Chinese buyers on their return from holiday are reluctant to chase copper higher and so in the short term copper's recent gains may prove difficult to sustain," said analysts at Barclays Capital.

At 2.01 pm, LME copper for three-month delivery was down slightly at 7,739 usd a tonne, against 7,765 usd at the close yesterday.

Prices in the red metal remain well supported by declining inventories at LME monitored warehouses. Copper stockpiles have been dropping by around 2,000 tonnes a day over the last two weeks, with a similar draw down today putting stocks of the red metal at 157,600 tonnes.

Robust expectations for long-term Chinese demand for copper and other industrial metals is also lending a solid floor to prices. Rio Tinto, the world's third largest mining company, today argued demand could well hold up despite the current economic turmoil, which has pressured prices in recent months.

Vivek Tulpule, chief economist at Rio Tinto, said: "Virtually all minerals and metals prices remain significantly above historical trend and many prices have now increased well above start-of-year levels.

"Indeed, it is arguable that even as negative sentiment in relation to the US economy and credit markets has continued to increase over 2008, the market's perceptions about fundamentals in most resource markets do not appear to have been much affected."

The copper market remains tight due to rising global demand, keeping prices at higher levels, with some analysts predicting the red metal could test record highs in the first six months of the year.

"The picture for copper fundamentals remains strong and we still expect to see prices test all-time highs in the first half of this year," said analysts at Barclays Capital. "The big problem for copper is that mine supply has fallen even further behind demand."

Among other metals traded on the LME, tin remains supported around the 17,000 usd a tonne mark, with concerns over tightening supply helping to underpin prices.

The metal, which is widely used in electroplating and in alloys, was pushed to a record high of 17,550 usd a tonne late last year by a spate of supply disruptions from major producers China and Indonesia. The market is expected to remain tight this year.

Tin was down slightly at 17,075 usd a tonne against 17,100 usd.

Among other metals,, nickel eased to 28,050 usd a tonne from 28,100 usd, zinc fell to 2,420 usd a tonne against 2,485 usd, while lead dropped to 3,021 a tonne against 3,065 usd. Aluminium bucked the trend to trade up slightly at 2,659 usd a tonne from 2,654 usd.

d.sheppard@thomson.com

Metals - Gold steady near 900 usd/oz as investors weigh slower physical demand

2008-02-13T06:44:00.001-08:00

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LONDON (Thomson Financial) - Gold held steady near 900 usd per ounce as the dollar remained fairly steady and as players digested a report suggesting physical demand is slowing.

The precious metal remains a fairly attractive purchase for investors, however, buying bullion as a safe haven asset as market turmoil is showing few signs of abating.

The US dollar got a lift after the release of better-than-expected retail sales data for January released earlier today.

Gold moves in the opposite direction to the dollar as it is seen as an alternative asset.

At 2.02 pm, gold was down at 902.25 usd an ounce against 908.50 usd in late New York trade yesterday.

Meanwhile, the market digested figures showing lower physical demand amid recent higher prices.

Identifiable demand fell 17 pct in tonnage terms from year-earlier levels in the fourth quarter, said the World Gold Council earlier today.

The figures show this trend was "most keenly felt in India, the world's largest and also most price sensitive gold market, where demand fell 64 pct on year earlier levels following 40 pct growth in the first three quarters," said the WGC.

"Physical buyers will not come back in until the price is much lower," said Commerzbank analyst Rory McVeigh. "Without those fundamentals in the market there's a lot of supply, but little demand. The stability we've seen in the currency markets over the last couple of days is also pushing down prices, and we've seen some widespread profit-taking from the funds."

The gold price has, in recent months, been underpinned by ongoing recessionary fears, which have seen investors buy bullion as it is seen as a safe store of wealth during times of economic turmoil. Gold touched an all time high of nearly 940 usd an ounce earlier this year, helped in part by such fears.

In other precious metals, platinum rose to 1,927 usd against 1,925 usd on profit-taking.

Platinum has rallied to a series of all-time highs in recent weeks, buoyed by ongoing supply concerns out of number one producer South Africa, where electricity shortages are impacting mine activity. The white metal hit another fresh all-time high yesterday of 1,969.50 usd per ounce.

With many analysts predicting a significant supply deficit of platinum this year, many market watchers expect the price to bounce back higher.

"Given the scale and pace of recent gains, it is not surprising to see a fairy substantial correction," said TheBullionDesk.com analyst James Moore. "However, with the power supply situation in South Africa still far from resolved, traders are likely to be wary of going short and will still view dips as buying opportunities."

Standard Bank yesterday revised its average platinum price forecast for 2008 up to 1,900 usd an ounce due to the South African power shortages. The bank sees the market recording a 400,000 ounce supply deficit in 2008 against a shortfall of 265,000 ounces last year.

"We continue to see good support for the metal, especially in light of supply problems -- which could make platinum susceptible to upward spikes --," said Standard Bank analyst Walter De Wet earlier today.

Platinum's sister metal palladium was down at 419 usd an ounce against 430 usd in late New York trades, while silver eased to 17.08 usd an ounce against 17.21 usd. Silver touched a multi-decade high of 17.59 usd yesterday before being dragged lower with the rest of the precious metals complex.

anealla.safdar@thomson.com

Oil off day highs as market attention turns to US inventory data

2008-02-13T06:39:00.000-08:00

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LONDON (Thomson Financial) - Oil steadied but came off day highs as market attention turned to this afternoon's US energy inventory report, which is expected to show crude stocks rose again last week.

At 1.57 pm, New York's WTI crude for March delivery was down 18 cents at 92.60 usd per barrel.

In London, Brent crude for March delivery was up 10 cents at 92.96 usd per barrel.

Prices were above 93 usd earlier as players digested overnight news that Venezuela's state oil company PDVSA has opted to cut oil sales to US oil giant ExxonMobil.

However, with the news now priced in, attention has shifted to expectations this afternoon's US data will show US crude stocks rose by 2.1 mln barrels last week, while gasoline stock increased by 1.7 mln barrels.

In addition, news that the International Energy Agency has trimmed its 2008 oil demand forecast because of the pending economic growth slowdown in the US is also capping the upside.

"Today's gains on the back of supply concerns (from Venezuela) are likely to be capped by persistent economic fears and by more bearish news expected later," said Sucden analyst Michael Davies.

He also said that on the Venezuelan issue, major global producers have reassured the US that they can compensate for any shortfall in supplies from Venezuela.

All the same, however, the ongoing dispute between Venezuela and the US, which sent oil prices to a one-month high on Monday, is still putting a floor under prices.

The dispute as it stands currently affects some 90,000 barrels of supply to the US, and while most analysts say this is not a large amount, there is always a risk that Venezuela will up the ante again.

On Sunday, Venezuelan President Hugo Chavez threatened to cut all oil supplies to the US after ExxonMobil won a court order freezing up to 12 bln usd in PDVSA assets.

Oil prices rallied strongly in response, but are settling down now as Chavez seems content with only cutting supplies to ExxonMobil -- the company seeking compensation for the Venezuela's nationalization of key oilfields.

"I think Chavez has backed down from the Sunday night threats," said Laughlin, adding that while the market will react in the short term to the Venezuela headlines, downside price pressures remain.

These pressures are linked to concerns the US economy is heading into a recession that will bite into demand at a time when oil stocks in the world's biggest energy consumer are rising.

The International Energy Agency said in its report earlier its 2008 oil demand forecast has been trimmed by 200,000 bpd, and warned the US economic slowdown could shape the oil market for some time to come.

Bank of Ireland analyst Paul Harris said while oil could advance if the Venezuelan position hardens, the market will likely face strong resistance around 94.30 usd because of demand-side worries and rising US stocks.

maytaal.angel@thomson.com

ECONOMIC REPORT: Jan Retail Sales Up Better-Than-Expected 0.3%

2008-02-13T06:38:00.002-08:00

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ECONOMIC REPORT: Jan Retail Sales Up Better-Than-Expected 0.3%

By Greg Robb

WASHINGTON (Dow Jones) - U.S. retail sales were better-than-expected in January, pushed higher by a surprise gain in auto sales and the rising cost of gasoline, the Commerce Department reported Wednesday.

Retail sales rose 0.3 % in January after sinking 0.4% in December.

Excluding autos and gas, sales were flat in the month.

Economists expected a 0.3% decline in January sales.

Retail sales are up 3.9% in the past 12 months.

Gasoline station sales rose 2.0% in January after remaining unchanged in December. Excluding gasoline, retail sales rose 0.1%. Over the past year, gasoline sales are up 23%.

Motor vehicle sales rose 0.6% by dollar value. This is the biggest gain since September. Excluding autos, retail sales rose 0.3% This was in-line with expectations.

Economists were surprised by the gain in auto sales. Car companies reported dreadfully slow rate of auto sales in January, with sales falling to an annual sales rate of just 15.3 million.

Retail sales represent about half of consumer spending, which in turn accounts for about two-thirds of final sales in the economy.

Retail sales in the past three months are up 0.2% compared with a 0.3% rise in the previous three months.

Details

Sales were also strong at clothing and electronic retailers. Health and personal care store sales were also strong. Most other categories were weak in most other retail sectors.

Clothing store sales rose 1.4% in January, the largest gain in eight months. Sales at health and personal care stores rose 0.8%, the biggest gain since July.

Internet and mail order sales rose 0.5% in the month.

Sales at general merchandise stores rose 0.1%.

Department store sales fell 1.1% in January and are down 4.8% in the past 12 months.

Sales at hardware and garden stores dropped 1.7%.

Sales at furniture stores fell 0.5%. Sales at appliance and electronics stores fell 1.0%.

Sales at sporting goods, music and book stores fell 1.3%.

Restaurant sales fell 0.5% in January.

(END) Dow Jones Newswires

February 13, 2008 09:21 ET (14:21 GMT)

UPDATE: Bank Of England Sees 'Balanced' Inflation Risks

2008-02-13T06:38:00.001-08:00

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UPDATE: Bank Of England Sees 'Balanced' Inflation Risks

By William L. Watts

LONDON (Dow Jones) - Risks to economic growth remain weighted to the "downside," while inflation is poised to temporarily spike higher than ease back down, highlighting a difficult environment for monetary policymakers, the Bank of England said in its quarterly inflation report Wednesday.

The report's central projection assumes a further decline in the bank's key lending rate to 4.5% -- a fall in line with current market expectations -- by the fourth quarter of 2008. The rate now stands at 5.25% after last week's quarter-point reduction. Read the inflation report.

"Two key developments shape the [Monetary Policy Committee's] latest projections," said Bank of England Gov. Mervyn King, in opening remarks at a news conference to release the report. "First, tighter credit conditions for households and businesses will bear down on demand both in the United Kingdom and abroad. Second, rising energy, food and import prices will push up on inflation."

Consumer price inflation came in at 2.2% in January, above the Bank of England's long-term target of 2%. The report's central projections indicate inflation is likely to rise more than one percentage point above the target before coming back down.

An increase in the consumer inflation rate of more than a percentage point above the target requires the governor to write an open letter to the Chancellor of the Exchequer explaining the spike.

The BOE's projections don't show the U.K. economy tipping into recession.

King said turmoil in global financial markets is part of a wider shift in global financial imbalances and said that monetary policy shouldn't be used to attempt to reverse changes in "relative prices."

"Although the Monetary Policy Committee cannot deliver a completely steady path for output growth, it will take into account the implications of changes in financial conditions for demand, and hence, inflation," King said. "And it is the outlook for inflation in the medium term on which the Monetary Policy Committee remains focused."

Economists at Bear Stearns said the report showed the central bank holds an easing bias, but that King is seeking to convince markets that further rate cuts will come more slowly than expected.

Expectations for a slower pace of rate cuts boosted the British pound, which was 0.2% higher against the U.S. dollar at $1.9631 in recent trade and changed hands at 0.7430 euros, a gain of 0.1% against the European single currency.

The Bear Stearns economists weren't convinced, however.

"With consumer and business confidence on the slide, the housing market cooling and the credit crisis contagion still spreading, the odds are that much lower growth this year will have the whip hand for easing," they wrote.

(END) Dow Jones Newswires

February 13, 2008 09:21 ET (14:21 GMT)

Wal-Mart gets a premarket lift from better-than-expected retail sales data

2008-02-13T06:37:00.001-08:00

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NEW YORK (Thomson Financial) - Shares of Wal-Mart Stores Inc. got a lift in premarket trading Wednesday from better-than-expected January retail sales data.

The world's biggest retailer's stock, a component of the Dow industrials, last traded at $50.35 ahead of the open, up 10 cents, or 0.2%, from Tuesday's close.

Just prior to the release of retail sales data, the stock changed hands at $50.03, down 22 cents, or 0.4%, from Tuesday.

The U.S. Commerce Department said January retail sales rose 0.3%, vs. the median estimate of economists surveyed by IFR Markets for a decline of 0.3%. Sales from general merchandise stores, which includes Wal-Mart, saw a decline of 1.1%, the largest sales drop since last June.

Tomi Kilgore

Foreign Exchanges - Continental Forward Rates

2008-02-13T06:24:00.000-08:00

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LONDON (Thomson Financial) -

Foreign Exchanges - Continental Forward Rates

Euro

1 Month 07.00 - 09.00 dis

2 Months 14.00 - 18.00 dis

3 Months 21.00 - 25.00 dis

6 Months 45.00 - 50.00 dis

12 Months 93.00 - 104.00 dis

Denmark

1 Month 17.00 - 03.00 prm

Norway

1 Month 06.00 - 10.00 prm

3 Months 03.00 - 18.00 prm

Sweden

1 Month 16.00 - 04.00 prm

3 Months 39.00 - 21.00 prm

Japan

1 Month 93.00 - 80.00 prm

3 Months 253.00 - 233.00 prm

Switzerland

1 Month 58.00 - 45.00 prm

3 Months 164.00 - 138.00 prm

Canada

1 Month 29.00 - 19.00 prm

TFN.newsdesk@thomson.com

U.S. dollar gets a lift from retail sales data; hits 1-mo. high vs. yen

2008-02-13T06:21:00.001-08:00

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NEW YORK (Thomson Financial) - The U.S. Dollar Index got a lift after the release of better-than-expected retail sales data for January.

The index, which tracks the greenback against the currencies of a number of the U.S.'s major trading partners, was last up 0.09 ticks, or 0.1%, at 76.405.

Just prior to the release of the data, the index was trading around 76.33.

Against the Japanese yen, the buck was changing hands at a one-month high of 107.92, vs. pre-data levels of around 107.52. The euro was trading at $1.4572 vs. the dollar, compared with pre-data levels of about $1.4583.

The U.S. Commerce Department said January retail sales rose 0.3%, vs. the median estimate of economists surveyed by IFR Markets for a decline of 0.3%. Excluding autos, sales rose 0.3% to the highest level seen since November, topping economist expectations of 0.2% growth.

Tomi Kilgore

Dollar Gains Versus Rivals On US Retail Sales Data

2008-02-13T06:19:00.000-08:00

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Dollar Gains Versus Rivals On US Retail Sales Data

By Riva Froymovich
Of DOW JONES NEWSWIRES

NEW YORK (Dow Jones)--The dollar immediately rose against the euro and yen after the release of a stronger than expected U.S. retail sales report early Wednesday.

The dollar reached an intraday high against the yen and Swiss franc at Y108.05 and CHF1.1080, respectively. The euro was also able to gain against the yen, a signal of increased risk appetite, in the aftermath, climbing to Y157.44.

However, a concentration of stop orders near Y108 make it a difficult level to decisively break through, said Brian Dolan, chief currency strategist at Forex.com.

"I expect there's also significant selling interest at Y108," he said.

The dollar's knee-jerk response against the euro, however, has mostly faded.

"After a few minutes...we see the headline number is not quite as stellar," considering the reported high prices of gasoline and falling home values depressing spending, Dolan said.

"It's still very much a carry trade or not-carry environment. Put it on and take it off," he said.

The carry trade strategy is employed by currency traders based on perceptions of risk. When risk appetite is elevated, funds are borrowed in the lower-yielding currencies to invest in those with higher interest rates. In this environment, the yen typically falls against both the dollar and euro.

Wednesday morning in New York, the euro was at $1.4580 from $1.4583 late Tuesday, while dollar was at Y107.94 from Y107.29. The euro was at Y157.38 from Y156.42. The U.K. pound was at $1.9630 from $1.9619, according to EBS, while the dollar was at CHF1.1072 from CHF1.1022 late Tuesday.

U.S. retail sales unexpectedly climbed in January by 0.3% compared with a 0.4% decline in December, the Commerce Department said Wednesday.

The sales report is a key indicator of U.S. consumer spending. Consumer spending makes up about 70% of U.S. gross domestic product, which grew a sluggish 0.6% in the fourth quarter after racing along at a 4.9% pace during the third quarter.

-By Riva Froymovich, Dow Jones Newswires; 201 938-5063; riva.froymovich@dowjones.com

(END) Dow Jones Newswires

February 13, 2008 09:00 ET (14:00 GMT)

US retail sales increase 0.3% in January, against expectations

2008-02-13T06:18:00.000-08:00

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FXstreet.com (Barcelona) – Retail sales have increased 0.3% in the United States in January in seasonally adjusted terms, against the market expectations of a 0.2% decline, according to data released by the US Census Bureau.

The surprise in January’s sales has been, according to Ian Shepherdson, Chief U.S. Economist at High Frequency Economics, Ltd, the increase in auto sales: “The big surprise here is the 0.6% rise in auto dealers' sales, despite the automakers' reporting a 6.4% plunge in sales. The data don't always move together but this is a huge gap; it appears to suggest that all the drop in sales was to fleet buyers rather the individuals.”

January’s increase reverses the 0.4% decrease posted in December. On the year, retail sales have increased 3.9%, while in the quarter to January, sales have posted a 4.4% increase compared to the same period last year.

Retail trade sales increased 0.4% from December, while they increased 3.8% on the year, and sales in gas stations increased 23.0% on the year, while sales on non-store retailers increased 10.6% on the year.

U.S. stock futures spike after surprise increase in retail sales

2008-02-13T06:16:00.000-08:00

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NEW YORK (Thomson Financial) - U.S. stock futures jumped Wednesday as investors cheered a surprise rise January retail sales data.

S&P 500 futures were up 11.70 points at 1,361.50 and Nasdaq 100 futures gained 16.50 points to 1,806.50.

The Dow industrials "Diamonds" ETF tacked on 71 cents, or 0.6%, at $124.48 in premarket trading.

Just prior to the release of retail sales data, S&P 500 futures were trading around 1,353, Nasdaq 100 futures were around 1,799.50 and the Diamonds were at $123.88.

The U.S. Commerce Department said January retail sales rose 0.3%, vs. the median estimate of economists surveyed by IFR Markets for a decline of 0.3%. Excluding autos, sales rose 0.3% to the highest level seen since November, topping economist expectations of 0.2% growth.

Tomi Kilgore

Ahead of the Bell: Mortgage Applications

2008-02-13T03:46:00.000-08:00

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WASHINGTON (AP) - Home-loan data to be released Wednesday will show whether mortgage applications rose for the sixth-straight week as borrowers took advantage of lower rates.

The Mortgage Bankers Association is scheduled to report its index of home-loan application volume for the week ended Feb. 1 at 7 a.m. EST. The seasonally adjusted index surged last week to the highest level since March 2004.

For the week that ended Feb. 1, the trade group's seasonally adjusted index of mortgage application volume rose 3 percent to 1086.6, amid a 12 percent jump in purchase applications and a 1 percent increase in refinancing applications.

Freddie Mac, the mortgage company, reported last week that 30-year, fixed-rate mortgages in the U.S. averaged 5.67 percent, down slightly from 5.68 percent a week earlier. Rates for 30-year mortgages, which ended last year at 6.17 percent, have been below 6 percent for five weeks, a stretch not seen since 2005.

The mortgage bankers' index, which stood at 100 at its onset in March 1990, is derived from a survey of major lenders representing about half of the U.S. mortgages made each week. It does not include loans made by nonbank lenders.

The index has fluctuated over the past 18 months after sinking in June 2006 to 529.6, its lowest level since 2002. It peaked at 1,856.7 in May 2003 at the height of the housing boom.

The mortgage industry's woes, which started with rising defaults among borrowers with weak credit and spread to better-quality loans, have shuttered dozens of lenders and led to multibillion dollar losses.

Copyright 2007 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

ROUNDUP German workers asking for wage hikes to launch, widen warning strikes

2008-02-13T03:45:00.001-08:00

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FRANKFURT (Thomson Financial) - German workers in steel, retail and public service sectors have declared they will either launch or widen warning strikes nationwide in a bid to push for wage hikes ranging 4.5-12.00 pct.

Ver.di trade union said the public service sector warning strikes will start tomorrow with hospital employees stopping their work for a limited number of hours in the rich industrial region of Bavaria and in Hesse, home of Frankfurt's bourse and the country's banking capital.

Ver.di said it will target next week children day-care centres, savings banks and commuter transport systems in these two regions.

The public sector workers have rejected the average 5 pct wage hike being proposed by state and municipal governments, saying this falls short of their demands for an 8 pct increase.

A spokesman for the public sector employer representative described the union plans for warning strikes as a "play for power".

In Berlin, workers of the capital's transport system BVG are in the midst today of a 10-hour warning strikes being staged at the main administrative office and in repair shops. They kept buses, trams and underground commuter railways running this time.

On Feb 1-2, BVG -- which is seeking 8-12 pct more money for its 11,500 workers -- had staged a 39-hour warning strike that paralyzed the city's transportation system.

Pay bargaining talks for around 120,000 workers in the western region's textile and clothing industries have adjourned their negotiations today, with employers rebuffing IG Metall trade union's demand for a 5.5 pct wage increase.

The employers group, who have yet to make a counter-offer, said they cannot afford to pay those levels because revenues have been declining.

Ver.di said warning strikes in the retail industry will be expanded beyond the regions of Bavaria, Baden-Wuerttemberg and Rhineland Palatinate and will now include the federal state of Thuringia.

The industrial action in the retail industry is aimed at hitting Metro AG as well as supermarket chains affiliated with Karstadt and branches of Globus, Kaufland and Ikea, Ver.di said.

Ver.di has been demanding since April 2007 between 4.5 pct and 6.5 pct more wages for 2.6 mln workers in the retail branch. The employer group had offered only 1.7 pct hike.

marilyn.gerlach@thomson.com

BoE's King says it is quite possible UK house prices will fall in 2008 UPDATE

2008-02-13T03:42:00.000-08:00

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(Updating to add comments on mortgage rates)

LONDON (Thomson Financial) - It is quite possible that UK property prices will fall in 2008 as household spending decreases, Bank of England Governor Mervyn King said.

Speaking at a press conference after the release of the Inflation Report, King said that as the economy slows, households' savings rates will have to increase, implying a fall in prices.

"There are no reasons to see house prices above current levels in the next few years," said King.

Even though house prices are likely to stabilise over the coming few years, King said affordability ratios will improve, noting that unchanged prices over the next five years will lead to a 20 pct in the ratio of prices to earnings.

King also said it is not that surprising that lenders have not reduced mortgage rates as much as the BoE has reduced the benchmark Bank Rate, which has fallen 50 basis points over the last few months to 5.25 pct.

He said it's not a lack of competition in the banking sector that's preventing mortgage rates falling to the same extent, noting that when Bank Rate was rising in 2006/7 mortgage rates did not increase by the same amount as banks and building societies instead chose to reduce margins.

"That maybe was not wise in the event," he said.

King said it's perfectly natural that banks may want to rebuild margins now.

carlo.piovano@thomson.com

Bulgarian Jan HICP Rises 1.5% On Month, 11.7% On Year

2008-02-13T03:41:00.000-08:00

Wed, Feb 13 2008, 11:30 GMT
http://www.djnewswires.com/eu

Bulgarian Jan HICP Rises 1.5% On Month, 11.7% On Year

DOW JONES NEWSWIRES

Bulgarian inflation continued to accelerate in January, driven by increasing food and energy costs.

Inflation was 1.5% on the month and 11.7% on the year, preliminary data calculated according to European Union methods and published Wednesday by Bulgaria's National Statistics Institute showed.

The annual rate of inflation was 11.6% in December.

Food prices rose 2.2% on the month and 20.6% on the year in January, the data showed.

Health service and goods prices rose sharply, up 3.3% on the month, but that was largely a seasonal effect as the annual rate of increase was only 5.1%.

Clothing prices dropped slightly on the month while rising 9.4% from January 2007.

Using Bulgaria's national consumer price index, inflation was an annual 12.5% in January, the same rate as the month before.

-By Christopher Emsden, Dow Jones Newswires; +39-02-58-21-99-05; chris.emsden@dowjones.com

(END) Dow Jones Newswires

February 13, 2008 06:30 ET (11:30 GMT)

BoE's King says it is quite possible UK house prices will fall in 2008

2008-02-13T03:39:00.000-08:00

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LONDON (Thomson Financial) - It is quite possible that UK property prices will fall in 2008 as household spending decreases, Bank of England Governor Mervyn King said.

Speaking at a press conference after the release of the Inflation Report, King said that as the economy slows, households' savings rates will have to increase, implying a fall in prices.

"There are no reasons to see house prices above current levels in the next few years," said King.

Even though house prices are likely to stabilise over the coming few years, King said affordability ratios will improve, noting that unchanged prices over the next five years will lead to a 20 pct in the ratio of prices to earnings.

carlo.piovano@thomson.com

Forex - Pound strengthens after BoE's hawkish inflation report UPDATE

2008-02-13T03:36:00.001-08:00

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(Updates to add analyst's comments, press conference currently underway from 4th para)

LONDON (Thomson Financial) - The pound strengthened after the Bank of England (BoE) released a hawkish inflation report, indicating expectations the Bank Rate will be cut to 4.50 pct by year-end may be overdone.

The central bank provided a clear indication that UK borrowing costs are likely to fall again soon, but warned above-target inflation may limit the number of rate cuts it can enact.

In its quarterly Inflation Report, the BoE said the annual CPI inflation rate could well rise above 3.0 pct in the near term if rates fall as expected, but that its central projection is that it will peak around 2.9 pct sometime in the second quarter.

"The BoE is signalling an easing bias, but it is still trying to slow the implied future pace of easing," Bear Stearns chief European economist David Brown said.

"The BoE is worried that the 2 pct inflation target will remain breached if it cuts rates as aggressively as the market thinks," he said.

BoE governor Mervyn King is currently speaking at a press conference accompanying the publication of the inflation report.

King has said so far it is "odds-on" he will have to write an explanatory letter to Chancellor of the Exchequer Alistair Darling explaining why inflation is so far above target.

At 11.04 am, the pound had strengthened to 0.7427 per euro, from 0.7431 prior to the release of the report. Against the dollar, the pound strengthened to 1.9637 usd from 1.9613 usd previously.

chinny.li@thomson.com

cml/slm/cml/am

UK short sterling futures drop as BoE Inflation Report points to fewer rate cuts

2008-02-13T03:33:00.000-08:00

Forex FC Making Money News Collections

Wed, Feb 13 2008, 11:26 GMT
http://www.afxnews.com

LONDON (Thomson Financial) - UK short sterling futures -- a gauge of market interest rate expectations -- fell back as the Bank of England's quarterly Inflation Report suggested that interest rates will not be cut as much as the market has been pricing in.

The BoE warned that inflation is set to rise to close to 3 pct in the coming months, way above its 2 pct target. BoE governor Mervyn King also said it is "more likely than not" that he will have to write a letter to the Chancellor of the Exchequer, something he is obliged to do if inflation rises above 3 pct.

"The Bank of England is signalling an easing bias, but it is still trying to slow the implied future pace of easing. The message the Bank would like to get across to the market is that there is only room for moderate easing ahead," said David Brown at Bear Stearns.

"The short sterling futures strip has corrected slightly on the more cautious BoE line," he said.

After the initial spike in inflation, the BoE believes it will then ease back to around 2.2 pct in the medium-term. This, however, would still leave inflation above target, suggesting the Bank has less room to cut interest rates to support a flagging economy than the market had been assuming.

The BoE's forecasts are based on market expectations for the benchmark Bank Rate to fall to 4.50 pct by the end of 2008.

At 10.56 am, the March short sterling future was down 0.02 at 94.38, while the June future was down 0.04 at 94.77, both weaker than the levels of 94.39 and 94.78 respectively just before the report was released.

The September and December short sterling futures meanwhile fell by a larger amount. The September future was down 0.05 at 95.08, compared with 95.11 previously, while the December future fell 0.05 to 95.31 against 95.35 previously.

jessica.mortimer@thomson.com

jkm/ak

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BoE's King says 'odds-on' he will have to write to Chancellor in coming 2 years

2008-02-13T03:32:00.000-08:00

FOREX
Wed, Feb 13 2008, 11:09 GMT
http://www.afxnews.com

LONDON (Thomson Financial) - The Bank of England's governor Mervyn King said it is "odds-on" he will have to write an explanatory letter to Chancellor of the Exchequer Alistair Darling explaining why inflation is so far above target.

In remarks following the publication of the central bank's quarterly Inflation Report, King said that in the central projection, CPI inflation rises sharply from 2.2 pct in January "to around the level at which I would be required to write an open letter to the Chancellor".

Since the BoE was granted independence in the setting of monetary policy in 1997, only one such letter has been necessary and that was last April when King wrote to then Chancellor Gordon Brown explaining why CPI inflation had risen by more than one percentage point above the 2.0 pct target.

King said today's inflation profile is "significantly higher" than in the last report in November, reflecting the recent announcements of increases in household gas and electricity bills as well as rising import prices.

King also struck a fairly hawkish tone when he noted that inflation will have been at, or above target, in all but five months in three years if the central projection were to materialise over the rest of 2008.

"In these circumstances, keeping inflation expectations anchored firmly on the 2 pct target could not be taken for granted," said King.

"In the Monetary Policy Committee's judgement some slowing of demand growth, by reducing pressure on capacity, is likely to be necessary to bring inflation back to the target in the medium-term," he added.

King also said there are limits to what monetary policy can achieve.

"It is important to remember what monetary policy can and cannot achieve," said King.

King said the changes in the financial aspects are one aspect of a wider shift in the world economy as some of the imbalances unwind and that changes to risk premia, asset prices and exchange rates are all part of that adjustment.

"Monetary policy neither can nor should try to reverse these changes in relative prices," said King.

"But, although the MPC cannot deliver a completely steady path for output growth, it will take into account the implications of changes in financial conditions for demand, and hence, inflation and it is the outlook for inflation in the medium term on which the MPC remains focused," he added.

King also said much of the "doom and gloom" about the UK economy emanates from the City of London and the financial sector and that conditions outside the capital are not as bad.

pan.pylas@thomson.com

pp/cp/tfn-loc

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UPDATE: Euro-Zone Indus Output Drop Suggests GDP Slowdown

2008-02-13T03:31:00.000-08:00

UPDATE: Euro-Zone Indus Output Drop Suggests GDP Slowdown

(Adds details, economist comment)

By Nicholas Winning
Of DOW JONES NEWSWIRES

LONDON (Dow Jones)--Euro-zone industrial output fell for the second month in a row in December, indicating economic growth in the region slowed in the final quarter of the year, data from the European Union's Eurostat statistics agency showed Wednesday.

Factory output in the 13 countries that shared the euro at the time fell 0.2% on the month and increased 1.3% on the year, Eurostat said. That compares with a revised 0.4% drop on the month and 3.1% increase on the year in November. The November data was revised from a monthly drop of 0.5% and a 2.7% gain on the year reported last month.

The market was expecting a rise of 0.6% on the month and 2.3% on the year, according to a Dow Jones Newswires survey of economists last week.

"This (data) adds to the evidence that euro-zone overall gross domestic product decelerated sharply in 4Q07 from the solid pace of 0.8% quarter-on-quarter seen in the previous quarter," Martin van Vliet, a senior economist at ING in Amsterdam, said in a note.

Eurostat is due to publish preliminary fourth-quarter GDP growth data Thursday at 1000 GMT. The market expects growth of 0.3% on the quarter, leading to a slowdown in the annual rate of growth to 2.2% from 2.7%, according to Dow Jones Newswires survey.

The industrial production data are also likely to fuel the debate about when the European Central Bank might follow the U.S. Federal Reserve and Bank of England and begin to loosen its monetary policy to counter an expected slowdown in the region's economy.

Although the ECB was widely perceived to have softened its hawkish stance after it left its main interest rate at 4% last week, several Governing Council members have since stressed that the bank remains more concerned about inflation than economic growth.

Industrial production in Germany and France, the two biggest economies in the euro zone, grew on the month in December after falling the previous month.

Output in Italy, the third biggest economy, fell 0.5% after dropping 1.1% in November. In Spain, production slipped 0.3% on the month in December after dropping 1.6% in the previous month.

"This fits with the loss of external competitiveness of the latter two countries in recent years," van Vliet said.

The breakdown of the figures showed an improvement in output in all categories except for capital goods, where production fell 1.0% on the month after easing 0.2% in November. In year-on year terms, capital goods output growth slowed to 2.3% from 5.1% in November.

"A few months ago we were averaging around 6% to 7% year-on-year growth (of capital goods output). It suggests that a slowdown in investment going forward is going to undermine euro-zone growth," said Zahra Ward-Murphy, an economist at Dresdner Kleinwort.

Elsewhere, production of intermediate goods rose 0.3% on the month after falling 0.7% in November, output of energy rose 0.5% after increasing 0.2%, durable consumer goods production was flat after falling 1.9% in the previous month, while non-durable consumer goods output dipped 0.1% after falling 0.2%. In the 27 countries that make up the European Union, output fell 0.2% on the month and rose 1.2% on the year, Eurostat said. That compares with a 0.3% drop on the month and 2.8% gain on the year in November.

The following table details monthly percentage changes in euro-zone industrial production growth in December and November:

Dec Nov
Euro Zone -0.2% -0.4%r
Austria n/a -1.4%
Belgium n/a +1.3%
Finland -1.9% +2.3%r
France +0.7% -1.7%r
Germany +0.7% -0.2%r
Greece -0.2% +0.5%r
Ireland +2.4% -1.5%r
Italy -0.5% -1.1%r
Luxembourg +4.4%* +1.1%
Netherlands +3.0% +1.8%
Portugal +1.8% -3.7%r
Spain -0.3% -1.6%r
Slovenia -1.3% -2.8%r
* Estimated by member state
r Revised figures from previous estimate

Eurostat Web site: www.europa.eu.int/en/comm/eurostat

-By Nicholas Winning, Dow Jones Newswires; +44 (0)20 7842 9498; nick.winning@dowjones.com

(END) Dow Jones Newswires

February 13, 2008 06:07 ET (11:07 GMT)

Greater China economic and corporate news summary

2008-02-13T02:52:00.000-08:00

BEIJING (XFN-ASIA) - A summary of Greater China economic and corporate news at 1000 GMT

HONG KONG:

-Swire Pacific unit orders 8 AHTS vessels in 100 mln usd deal

-Wing Lung Bank rejects stake sale speculation; says no talks

-UK's TCI raises stake in Hong Kong-listed Guangzhou Investment; stock surges

CHINA:

-Retail sales during Lunar New Year holiday 255 bln yuan, up 16 pct

-Banks' end-2007 NPL ratio 6.17 pct - regulator

-Jan passenger vehicle retail sales in China up 32 pct yr-on-yr at 638,674 units

-Beijing-area plants to shut 30 days before Olympics to curb pollution -Platts

-China economic growth forecasts cut due to severe snowstorms - Lehman Brothers

-China to issue guidelines regulating bankruptcy law - report

-US workers group says antidumping duty on China tires a good step

-Chindex Oct-Dec net profit up 473 pct on China hospital ops

-Singapore-listed China Essence 3Q to Dec net profit up 85 pct

-Solar EnerTech Oct-Dec net loss widens on higher expenses

-Xiamen C & D to set up insurance jv with Taiwan Life

-MetLife China jv approved to offer investment-linked insurance products

-Anshan Iron, European Carbon Fund and Camco sign carbon credit deal

-Wonder Auto Q4 sales up 55.4 pct at 29.7 mln usd, profit up 81.6 pct

-Chongqing Changan Auto Jan vehicle sales 22,166 units

-Wanzhou Commercial Bank approved to change name to Three Gorges Bank

-ChinaCast Education buys 80 pct stake in FTBC for 480 mln yuan

-Ningbo Marine, Shenhua Energy sign coal shipping deal

-Hainan Power to build 2.1 bln yuan undersea cable to Guangdong -Xinhua

-Shanghai Huayi to issue 2.5 bln yuan in 365-day debt

-Aluminum Corp of China issues 2 bln yuan in 1-yr debt; yield 4.99 pct

-HK-listed Sichuan Expressway to issue 1.5 bln yuan in 1-yr debt Feb 19

-Moody's says monitoring developments at Neo-China amid resignations

TAIWAN:

-Taiwan adds 20 bln twd to incentives designed to attract investment

-First Financial Jan net profit 955 mln twd vs 890 mln in Dec

-First Financial denies reported 2008 earnings targets

-Hua Nan Jan unaudited net profit 787 mln twd vs 420 mln in Dec

-Chang Hwa Bank Jan pretax profit 706 mln twd vs 477 mln in Dec

-High Tech Computer sees Q1 gross margin 33-34 pct vs 42.2 pct in Q4

-Taiwan Chunghwa Picture Jan consolidated sales 13.87 bln twd vs 14.02 bln in Dec

-ASE Inc Jan consolidated sales 8.59 bln twd vs 7.14 bln

-MediaTek Jan consolidated sales 6.51 bln twd vs 5.06 bln

-Teco Jan parent sales 2.53 bln twd vs 2.13 bln

-Taiwan Glass Jan parent sales 1.33 bln twd vs 1.27 bln

-Powerchip, Japan's Renesas, Sharp to establish JV

-ProMOS Jan parent sales 2.81 bln twd vs 7.05 bln

Bank of Korea governor sees downward risks to growth increasing

2008-02-12T21:08:00.001-08:00

Wed, Feb 13 2008, 05:06 GMT
http://www.afxnews.com

SEOUL (Thomson Financial) - Downward risks to domestic growth are mounting as the troubled US economy has spawned an increasingly downbeat prospect for the global economy, said Lee Seong-Tae, governor of South Korea's central bank, the Bank of Korea.

"The growth outlook for key global economies, including the US, Europe and China, has been revised down recently, and I believe that will affect our exports in the future," the BoK governor said after the central bank's monthly policy-setting meeting this morning.

The BoK left its policy rate target for February unchanged at 5 percent for the sixth straight month.

"Local stocks fell sharply amid heightened volatility in global financial markets, which should affect consumer sentiment. Downward risks to our growth projection are gradually growing."

His remarks may be taken as a hint that the central bank will henceforth take a more flexible monetary policy, a departure from its long-standing hawkish stance, although its looser yet sustained vigilance against inflationary pressure may disappoint those who are expecting a rate reduction in March.

The BoK has increased its policy rate target by 175 basis points between October 2005 and August 2007 to the current level of 5 percent, the highest since June 2001.

"Consumer prices will likely stay at the upper end of our target range in the first half before easing in the latter half as the slowing global economy will keep a lid on rising raw material prices," Lee said.

"But still, that would not be a very satisfactory level," he warned.

The central bank is targeting the gain in consumer prices to be in a range of 2.5-3.5 percent.

Under an increasingly uncertain economic environment, Lee said the central bank should weigh conflicting risks and adopt prudent monetary policy decisions.

saeromi.shin@thomson.com

Japan's January corporate failures down 0.3 percent from December - Teikoku

2008-02-12T21:04:00.001-08:00

Wed, Feb 13 2008, 05:02 GMT
http://www.afxnews.com

TOKYO (Thomson Financial) - The number of Japanese corporate bankruptcies in January fell 0.3 percent from December, private research firm Teikoku Databank Ltd said Wednesday.

The fall followed a 1.7 percent fall in December, a 16.3 percent fall in November and a 38 percent surge in October.

The decline was attributed to fewer bankruptcies in the retail and manufacturing sector, Teikoku said.

A total of 888 companies went bankrupt in January.

Corporate failures reached 1,083 in October, a record high since Teikoku began compiling the data in its current form in April 2005.

In the retail sector, there were 180 corporate failures, down 6.7 percent from December, while there were 110 failures in the manufacturing sector, down 6.8 percent from a month earlier.

Meanwhile, there were 243 corporate failures in the construction sector, up 5.7 percent from December but below a record 309 in October as this sector continues to suffer from tumbling housing starts.

Housing starts in Japan shrank by a double-digit pace for sixth straight months until December following the introduction of tighter building permit rules.

Japan's revised Construction Standard Law made the certification of building blueprints stricter, following revelations that lax screening procedures had made it possible for construction plans with fake anti-seismic data to be approved.

That meant buildings that were unable to stand earthquakes were allowed to be erected in earthquake-prone Japan.

Total liabilities left by failed companies declined by 5.7 percent to 389.06 billion yen after declining by 9.8 percent in December.

(1 US dollar = 107.15 yen)

kaori.kaneko@thomson.com

Oil prices higher in Asia on Venezuelan supply suspension

2008-02-12T20:57:00.000-08:00

SINGAPORE (Thomson Financial) - World oil prices rose in Asian morning trade Wednesday after Venezuela's state petroleum company PDVSA said it suspended oil supplies to US energy giant ExxonMobil.

In morning trade, New York's main contract, light sweet crude for delivery in March, rose 25 cents to 93.03 dollars per barrel.

The contract fell 81 cents to 92.78 dollars a barrel during floor trading on Tuesday at the New York Mercantile Exchange.

Brent North Sea crude for March delivery rose 30 cents to 93.16 dollars a barrel after settling 67 cents lower at 92.86 dollars on Tuesday in London.

Venezuela's move came after ExxonMobil, the world's biggest energy company, secured international court orders freezing up to 12 billion dollars in PDVSA assets.

The court orders were issued as part of an international arbitration sought by ExxonMobil to gain compensation for the leftist Venezuelan government's nationalization of key oil fields in the Orinoco basin.

"The move was not completely surprising so there will not be a huge disruption to prices," said Steve Rowles, analyst at CFC Seymour securities in Hong Kong.

The cut in supply would temporarily push prices higher, said Rowles. Venezuela's oil market has more to lose from cutting its supplies to the US, he said.

In a statement, the Venezuelan company cited "judicial-economic aggression" by ExxonMobil as the reason for its action, which it described as an act of "reciprocity."

Crude prices soared Monday after weekend threats by Venezuelan President Hugo Chavez to cut oil deliveries to the United States.

The market was also looking to the weekly US crude stockpiles report due later Wednesday. Dealers expected a fifth straight increase in crude stockpiles.

The US has embarked on a period of reserves rebuilding, a trend that since last month has dampened fears of insufficient supply, particularly during the Northern hemisphere winter.

"The increase in stockpiles at this time is just part of the yearly cycle," said Rowles.

But the market remains on edge over political and supply risks, as well as signs of slowing economic growth in the US that could dent demand.

"Geopolitical uncertainty and potential supply disruption fears have provided a strong lift to prices, acting to have temporarily pushed aside sagging demand concerns from the poor economic outlook," Mike Fitzpatrick of MF Global said earlier.

afp/nt

-

nt/nt

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Japanese government bonds end morning lower after Buffett offer

2008-02-12T20:56:00.002-08:00

TOKYO (Thomson Financial) - Japanese government bond prices ended Wednesday morning lower after investors reduced their demand as stocks rallied following news that billionaire investor Warren Buffett had offered to help out troubled bond insurers in the US.

Japanese stocks posted healthy gains on the news and the benchmark Nikkei 225 index ended the morning session 1.4 percent higher at 13,202.70.

Buffett said in an interview on CNBC that his Berkshire Hathaway Inc holding company has offered a second level of insurance on up to 800 billion US dollars in municipal bonds for Ambac Financial Group Inc, MBIA Inc and Financial Guaranty Insurance Co, known as FGIC.

Buffett said a deal would only back municipal bonds, and not the risky and complicated financial instruments that many see as more likely to have problems.

"Japan's bond market mirrored US Treasurys overnight but the early morning bond sell-off tapered off and stayed in narrow ranges," said Naomi Hasegawa, senior strategist at Mitsubishi UFJ Securities.

She said the bond market's calm reaction to the Buffett news was due to the fact that he said the deal only helps municipal bonds and that two of the three troubled bond insurers had reportedly rejected the offer.

"So it seems that the deal may not be realized," Hasegawa said.

Investors were also waiting for the results of the 5-year government bond auction early this afternoon.

Japan's Ministry of Finance has set a coupon of 0.9 percent on 2.0 trillion yen worth of 5-year government bonds it will auction today.

At midday, the yield on the benchmark 10-year bond had risen to 1.420 percent from 1.395 percent on Tuesday.

The yield on the 2-year note inched up to 0.555 percent from 0.550 percent, while the yield on the 5-year bond was higher at 0.885 percent from 0.870 percent.

The yield on the 20-year bond rose to 2.080 percent from 2.060 percent and the yield on the 30-year bond advanced to 2.340 percent from 2.325 percent.

Bond prices move inversely to yields.

The price of the March futures contract for the 10-year bond was down at 137.90 yen from 138.13 yen late Tuesday.

(1 US dollar = 107.16 yen)

kaori.kaneko@thomson.com

-

kk/ng

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Australian Leading Employment Indicator Rises In Feb

2008-02-12T20:56:00.001-08:00

Australian Leading Employment Indicator Rises In Feb

CANBERRA (Dow Jones)--Australia's Department of Employment said Wednesday that its leading indicator of employment rose to a negative 0.086 in February from a revised negative 0.120 in January.

The indicator has now been rising for four straight months, the department said in an accompanying statement. But it would need to rise for six consecutive months to confirm a quickening in the pace of employment above its long-term trend of 2.5% a year, it said.

The indicator measures four weighted time-series variables: ANZ newspaper job ads, Dun & Bradstreet employment expectations, the Westpac-Melbourne Institute leading index of economic activity survey, and the Westpac-Melbourne Institute consumer sentiment survey.

The Australian Bureau of Statistics will issue January employment data Thursday.

-By Rachel Pannett, Dow Jones Newswires; 61-2-6208-0901; rachel.pannett@dowjones.com

(END) Dow Jones Newswires

February 12, 2008 22:11 ET (03:11 GMT)

Bank of Korea leaves benchmark rate at 5 percent for sixth straight month

2008-02-12T17:30:00.001-08:00

SEOUL (Thomson Financial) - South Korea's central bank on Wednesday left its key interest rate unchanged at 5 percent for the sixth straight month in February as it continued to strike a balance between managing economic growth and curbing inflationary pressures.

Eleven economists polled by Thomson Financial News had expected the Bank of Korea to keep the status quo, following a similar decision by key central banks elsewhere in the world including the European Central Bank.

Their inaction on interest rates highlights growing uncertainty surrounding the global economic outlook after the US housing and credit markets were thrown into peril.

The BoK lifted its policy rate target by a total of 175 basis points between October 2005 and August 2007 to the current 5 percent, the highest since June 2001.

saeromi.shin@thomson.com

sss/ms/sss/ms

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Taiwan central bank offers 2.04/2.13/2.23 pct NCDs

2008-02-12T17:29:00.001-08:00

TAIPEI (XFN-ASIA) - The central bank said it is offering 30-day negotiable certificates of deposit (NCDs) at a fixed rate of 2.04 pct, 91-day NCDs at 2.13 pct, and 182-day NCDs at 2.23 pct today.

Bids will be taken up to 10.15 am, it said.

adela.lin@afxasia.com

al/kmq

-

xfnal/xfnkm

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China Yuan Official Central Parity Rates For Wednesday

2008-02-12T17:28:00.002-08:00

China Yuan Official Central Parity Rates For Wednesday

The China Foreign Exchange Trade System published the following official central parity rates for major currencies against the yuan Wednesday:

Wednesday Previous
USD/CNY 7.1952 7.1846
HKD/CNY 0.92249 0.92118
JPY/CNY (per 100 yen) 6.7001 6.7309
EUR/CNY 10.4895 10.6497
GBP/CNY 14.0860 14.1820

China's currency market last traded Feb. 5 before closing for the week-long Chinese New Year holiday.

The daily central parity rate for the yuan versus the U.S. dollar is the weighted average of prices given by market makers. The highest and lowest offers are excluded from the calculation.

In each daily trading session, the central bank allows the dollar-yuan rate to move no more than 0.5% above or below the central parity rate. Other currency pairs are allowed to move as much as 3% above or below the central parity rate.

Source: www.chinamoney.com.cn

-By China Bureau, Dow Jones Newswires; 8621 6120-1200; djnews.shanghai®dowjones.com

(END) Dow Jones Newswires

February 12, 2008 20:21 ET (01:21 GMT)

Forex - US dollar higher on Buffett's offer to help bond insurers

2008-02-12T17:28:00.001-08:00

SYDNEY (Thomson Financial) - The US dollar was higher against the euro and sterling in late morning trade in Sydney on Wednesday, trimming overnight losses, as billionaire investor Warren Buffett's offer to help out troubled bond insurers in the US boosted sentiment on global financial markets.

News that Buffett's Berkshire Hathaway holding company has offered a second level of insurance of up to 800 billion dollars in municipal bonds for Ambac Financial Group, MBIA and Financial Guaranty Insurance alleviated concerns about further deterioriation in global credit markets.

Overnight, the greenback weakened against the euro and sterling after an unexpected rise in

German consumer confidence and an increase in the UK consumer price index boosted demand for the European and British currencies.

At 11.20 am (0020 GMT) the euro was buying 1.458 dollars after surging to 1.4593 dollars in late New York trade while the sterling was worth 1.9573 dollars compared with 1.9617 dollars overnight.

The dollar was trading at 107.38 against the yen compared with 107.35 yen last night.

The greenback has been sold heavily recently on the prospect of a solid recession in the US. NAB Capital currency strategist John Kyriakopoulos questioned the strength in global equity markets.

''Growth still looks weak in the US, euro zone and UK and there are still considerable risks to the global economy,'' Kyriakopoulos said.

Elsewhere, the Australian dollar was down at 90.34 US cents from 90.37 cents last night as a rebound in global equity markets increased demand for risky, high-yielding currencies.

''Improving investor confidence underpinned demand for high-yielding currencies like the Australian/US dollar,'' said Kyriakopoulos.

''Real money demand out of Asia helped propel the Australia dollar through 90.50 US cents and the currency was squeezed to an overnight high of 90.85 cents.''

Sydney at 11.20 am (0020 GMT)

US dollar

107.38 yen

1.1025 sfr

Euro

1.458 usd

156.52 yen

1.6075 sfr

0.745 stg

Sterling

1.9573 usd

210.130 yen

2.15785 sfr

Australian dollar

0.9034 usd

0.4615 stg

96.99 yen

New Zealand dollar

0.7894 usd

allison.jackson@thomson.com

aj/ms

bhx/ms

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Japan Portfolio Flows: Net Y5.59T Capital Outflow In Jan

2008-02-12T17:24:00.000-08:00

apan Portfolio Flows: Net Y5.59T Capital Outflow In Jan

TOKYO (Dow Jones)-- Nearly Y5.6 trillion flowed out of Japan's capital markets on a net basis in January, the largest such move in more than three years of government record-keeping, Japan's Ministry of Finance data showed Wednesday.

The largest portion of the outflow - some Y2.523 trillion - was Japanese purchases of foreign bonds. Japanese investors were also net buyers of foreign stock (Y663.1 billion) and short-term money-market instruments (Y98.3 billion).

Foreigners sold a net Y1.458 trillion of Japanese stocks but bought a net Y609.5 billion of bonds.

Reversing a two-month trend of heavy buying, foreigners also were net sellers (Y1.46 trillion) in Japanese money-market instruments, as short-term interest rates began to fall.

The flow doesn't represent a dangerous capital flight from Japan, but does highlight some of the persistent weakness in Tokyo shares, according to John Richards, Royal Bank of Scotland's managing director for strategy and economics in Asia-Pacific.

"Japan is well-buffered, it's big, it doesn't have a lot of its own debt held by foreigners despite the fact that the flows can be big sometimes," he said. "But it might help to explain some of the weakness in the Japanese equities market. It seems that positions got unwound in January, as foreign hedge funds that had equity positions around the world probably pared them back everywhere."

Over the last several years, Japanese have been net sellers of domestic shares and foreigners have been net buyers, magnifying their impact on the stock market, Richards said.

"There's not a lot of domestic support for the Japanese equity market, so when these guys are selling, the Japanese market goes down more than the U.S. market, even if the cause (of the selling) comes from the U.S.," Richards said.

Web site: http://www.mof.go.jp/english/e1c009.htm

New York Session

2008-02-12T17:13:00.001-08:00

Carry trades (long JPY-crosses) rallied with a vengeance in early NY trading as the 'Oracle of Omaha' rode to the rescue again. US and global stock markets surged on news that billionaire investor Warren Buffett was bidding to take on the municipal bond obligations of the largest US bond insurers, which are facing potential ratings downgrades on losses stemming from faltering CDO debt issues. The potential downgrade or failure of the bond insurers, also known as monolines, has been a dark cloud hanging over financial markets for months now, and any news that suggests they might be rescued has seen investor optimism resurface. As stock futures rallied, forex markets responded by buying up USD/JPY from 107.00 to 107.50 and EUR/USD from 1.4540 to a session high near 1.4615. Those moves saw EUR/JPY rally from 155.50 to a peak just above 157.00.

Stocks gave back half their gains by the end of the day, but were still in positive territory, with the S&P up about 0.7% on the day. US Treasury bonds fell as investors sought riskier assets on the prospect of a monoline bailout, with yields rising nearly 4 bps to 3.65% in 10 year note trading. The USD lost ground as the EUR and other currencies recovered on better-than-expected European ZEW investor sentiment readings. Gold fell over $18 to $905/oz as investor concerns were soothed and the yellow metal lost its safe-haven buying support. Oil prices also retreated over $1 to $92.50 ahead of weekly oil inventory reports in the US on Wednesday; forecasts are for an inventory increase, or 'build', of 2.4 mio. barrels.

Upcoming Economic Data Releases (Asia Pacific Session)

2/12 21:45 NZ Producer Prices- Inputs (QoQ) 4Q 2.30% - -
2/12 21:45 NZ Producer Prices- Outputs (QoQ) 4Q 1.60% - -
2/12 22:00 US ABC Consumer Confidence 10-Feb -33 - -
2/12 23:30 AU Westpac Consumer Confidence FEB -8.30% - -
2/12 23:50 JN Domestic CGPI (MoM) JAN 0.40% 0.00%
2/12 23:50 JN Domestic CGPI (YoY) JAN 2.60% 2.80%
2/12 23:50 JN Current Account Total DEC Â¥1782.5B Â¥1713.8B
2/12 23:50 JN Adjusted Current Account Total DEC Â¥2164.5B Â¥1912.0B
2/12 23:50 JN Trade Balance - BOP Basis DEC Â¥932.7B Â¥1027.0B
2/13 0:01 UK RICS House Price Balance JAN -49.10% -52.00%
2/13 4:30 JN Bankruptcies (YoY) JAN -1.00% - -
2/13 5:00 JN Consumer Confidence JAN 38.3 - -
2/13 5:00 JN Consumer Confidence Households JAN 38.0 37.5

Daily Market Outlook

2008-02-12T17:12:00.000-08:00

Japanese yen rises as G-7 warns of further financial market turmoil

The Japanese yen rose against the dollar on Monday after the Group of Seven nations warned of further financial market turmoil. The G-7 estimated global banks will write down $400 billion of losses on U.S. subprime mortgages. The greenback fell from 107.66 to 106.33 versus the Japanese yen on Monday.

Finance ministers and central bankers of the U.S., U.K., Canada, Italy, France, Germany and Japan ended a weekend meeting in Tokyo with a statement that ‘downside risks persist’, including the U.S. housing slump and tighter credit conditions. Financial institutions have marked down about $146 billion of losses since the start of 2007.

There was little news for foreign exchange markets on the G-7 meeting. G-7 reiterated the previous statement that exchange rates should reflect economic fundamentals. They tweaked comments on China's yuan to say ‘we encourage’ the need for greater appreciation of the currency, instead of ‘we stress’.

The single currency pared gains against the dollar from 1.4578 to 1.4482 as traders increased bets the European Central Bank will cut interest rates later this year. The yield on the December euribor interest rate futures contract fell to 3.31% from 3.64% a week ago. German two-year notes yielded 1.13 percentage points more than similar-maturity Treasuries, down from 1.32 percentage points a week ago. The euro strengthened earlier to 1.4578 versus the dollar after ECB council member Axel Weber said in an interview with the Frankfurter Allegemeine Zeitung newspaper the central bank is still concerned about inflation, which recently hit a 14-year high.

The British pound rebounded from 1.9402 to 1.9531 after the release of higher-than-expected U.K. PPI - the readings were the highest since 1991 (core M/M Jan was 0.8% versus forecast of 0.3%, trade balance and housing data also came in better than economists' forecast). However, the greenback bounced against the Swiss franc from 1.0946 to 1.1048.

The Australian dollar rose strongly against the U.S. currency from 0.8951 to 0.9059 after the Reserve Bank of Australia warned it would likely need to raise interest rates again, from an 11-year peak of 7%, to counter inflation.

Tuesday will see the release of U.K. BRC retail sales, CPI and RPI, eurozone and German ZEW survey

Japan's corporate goods price index up 3.0 pct in January, fastest in 27 years

2008-02-12T17:11:00.001-08:00

TOKYO (Thomson Financial) - Japan's corporate goods price index rose 3.0 percent in January from a year earlier, in line with rising commodity prices, according to data released by the Bank of Japan on Wednesday.

It was the fastest rise for the index since March 1981 when it increased by 3.8 percent. Economists were looking for a rise of 2.8 percent based on a poll by the Nikkei daily.

The index rose 0.3 percent from the previous month.

In December, the index increased 2.6 percent from a year earlier and was up 0.3 percent from November.

The export price index, in contract currency terms, rose 0.5 percent from a year earlier after falling by 0.2 percent in December. It rose 0.3 percent from the previous month.

The import price index, in contract currency terms, was up 16.5 percent from a year ago after rising by a revised 16.1 percent in December. It increased 1.0 percent from the previous month.

(1 US dollar = 107.36 yen)

yasuhiko.seki@thomson.com

yas/ms

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The copying, republication or redistribution of Thomson Financial News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Financial News.

Japan Jan Corporate Goods Price Index Table Of Data

2008-02-12T17:10:00.002-08:00

Japan Jan Corporate Goods Price Index Table Of Data

Following is a table of the corporate goods price indexes for January, together with their percentage changes from the month and year before.

Change On

Index Month Year
Domestic 105.6 +0.2% +3.0%
Export 99.9 -2.4% -5.7%
Import 126.5 -2.4% +6.8%

(The index for the base year 2005 equals 100.)

The dollar traded at an average rate of Y107.68 in January, the BOJ said, with the yen strengthening 4.2% from December and appreciating 10.8% from a year earlier.

(END) Dow Jones Newswires

Buffett offers to back municipal bonds

2008-02-12T17:10:00.001-08:00

OMAHA, Neb. (AP) - Billionaire investor Warren Buffett's offer to help insure municipal bonds assuaged some of the broader market's credit concerns Tuesday, but the troubled bond insurers may have little interest in extra coverage for their best assets.

Buffett's reinsurance offer wouldn't cover any of the subprime mortgage debt that's much more likely to cause problems for the bond insurers, and Berkshire Hathaway would require a substantial premium for covering the municipal bonds. Credit rating agencies were already worried the insurers won't have enough cash available to cover a potential spike in claims.

Stocks on Wall Street surged after Buffett discussed a few details of his offer to three companies to reinsure about $800 billion of their municipal bonds in an interview on CNBC, but two of the bond insurers have rejected the deal and analysts said it appeared unlikely.

Reinsurance is coverage that insurance companies purchase when they want to completely or partly insure the risk they have assumed for their customers.

"I really don't think this does much for anyone but Warren Buffett," said Kevin Giddis, fixed-income strategist at Morgan Keegan. "The thought of an insurer giving away its best business and their only means of surviving this mess in return for the rest of its 'junk in the trunk' should leave them cold."

Buffett said one of the three bond insurers Berkshire offered reinsurance to had already said no, but he didn't say which of the three companies -- Ambac Financial Group Inc., MBIA Inc. or Financial Guaranty Insurance Co. -- declined.

Then, Ambac said in a statement late Tuesday that the reinsurance wouldn't be in the best interests of the bond insurer or all of its policyholders.

That made Ambac the second company to reject Berkshire's offer. Ambac spokesman Peter Poillon said his company was not the one Buffett said rejected his offer.

Earlier this month, Buffett said Berkshire would not invest in any of the bond insurers, but his company would consider insuring some of the risks the bond insurers had assumed. And Berkshire launched its own bond insurance business late last year to take advantage of the credit problems other bond insurers have been having, so it's clear Buffett's not motivated by charity.

"When I go to St. Peter I will not present this as some act that will entitle me to get in," Buffett said on CNBC. "We're doing this to make money."

Berkshire spokeswoman Jackie Wilson said Buffett was traveling Tuesday, and no one was immediately available to comment.

Edward J. Grebeck, chief executive of Tempus Advisors, said he doesn't think the bond insurers will want to do this reinsurance deal with Berkshire because municipal bond risk isn't their problem.

"It's good for the policy holders, but bad for management," said Grebeck whose firm consults with hedge funds and private equity firms on credit risk.

Grebeck said the real problem for bond insurers is the structured finance products that now represent about 35 percent of the investments they back. Bond insurers originally offered insurance mainly to municipalities but that has changed in recent years.

Those risky, complex assets, called collateralized debt obligations or CDOs, include subprime mortgage debt given to customers with poor credit history. As those mortgages have increasingly defaulted, ratings agencies fear the CDOs supported by the troubled loans will default as well.

A spike in defaults in the coming months or years could force the insurers to pay billions of dollars in claims.

Some bond insurers, such as Ambac and FGIC, have been downgraded by ratings agencies in the past month as they have been unable or chosen not to raise capital to ensure their vital "AAA" financial strength rating.

Bond insurers essentially need "AAA" ratings to book new business.

Berkshire's new bond insuring division has a "AAA" credit rating. Buffett has said Berkshire's new company, Berkshire Hathaway Assurance Corp., already has done a couple of deals insuring municipal bonds despite being in business for less than two months.

Friedman, Billings, Ramsey & Co. analyst Steve Stelmach wrote in a research note that investors shouldn't consider Berkshire's offer a solution for bond insurers' problems.

If the bond insurers bought the reinsurance from Berkshire, Stelmach said they could still face credit downgrades because the bond insurers would be left with a riskier portfolio. Because they would no longer be insuring the municipal bonds themselves, they would lose some of the profit and remaining premiums associated with them.

"In fact, we believe the offer, if accepted, could ultimately accelerate the process toward a potential run-off for the bond insurers," Stelmach said.

William Schwitter, chairman of the global leverage finance practice at the law firm Paul Hastings, said the bond insurers "need a broader portfolio fix so I'm not surprised" that it has been rejected by at least two companies.

Schwitter said bond insurers likely need to free up more capital than could be available by reinsuring their municipal bond business -- a business that is considered the safest portion of their operations. The companies must set aside money to cover possible claims if they insure the bonds themselves.

The Berkshire offer "frees up capital devoted to municipal bond deals for CDOs; from that prospective it's a good thing, but it likely doesn't free up enough," Schwitter said.

But Buffett's offer could provide a starting point for a "multi-piece fix" and buy bond insurers a little more time before ratings agencies act, Schwitter said.

Berkshire owns insurance, furniture, jewelry and candy companies, restaurants, natural gas and corporate jet firms and has major investments in such companies as The Coca-Cola Co. and Wells Fargo & Co.

AP Business Writers Stephen Bernard and Leslie Wines in New York and Alan Zibel in Washington D.C. contributed to this report.

Copyright 2007 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.