Analysis of world markets

Key events for October, 30th, 2008

Positive influence of the measures undertaken by the central banks"
The efforts co-ordinated by the central banks on increase in liquidity on credit and the markets of capitals continue to the basic share indexes support .That has positively affected all currencies except yen and dollar. The factor of month end has given additional support for the share market. There are no reasons to doubt positive dynamics and on Friday. However next week raises very big doubts. On dollar there is a fixing of profits that has not allowed to finish descending movement on dollar. Now in the markets appetite to risks will gradually increase, but it is prospect of the next months. The turn point on dollar and yen will be generated next week.

IMF: the IMF Head Dominik Straus-Kan has noticed that there are all bases hopes that excessive volatility in the market at last has ended thanks to measures of the European governments and the governments of the USA. Measures «simply demand time to be completely effective», the managing director of IMF has told. He has noticed that «it is disturbed by world economic delay and social consequences». The Prime minister of Britain is rights, calling for reform of a world financial system as a whole as local events have global consequences. All countries, including the USA agree that the organised market works only. Straus-Kan will offer regulation strategy at a meeting of the Big Twenty in Washington on November, 15th

USD. The euro/US dollar pair grows again after share indexes of the USA again have passed to positive territory, and the prices for oil have risen from the minima reached earlier
Dollar has strengthened the positions against the European currencies, more than having compensated had in during last days losses on gamble that the foreign investors who have enclosed serious means in the American share actives who have considerably gone down in price lately, have increased buyes of dollar in the month end as a measure hedgings the investments. Smaller than decrease in rates of gross domestic product increase of the USA last quarter was supposed, and also record quarter profit of oil giant Exxon have made positive impact on moods of investors and have caused growth in the share market of the USA having supported thereby dollar in spite of the fact that in conformity in published today tentative estimation report of gross domastic product growth of the USA last quarter has made-0.3 % y/y against growth on 2.8 % in the previous period. Economists expected indicator decrease on 0.5 %. However optimism at us, as well as at many analysts, this statistics does not cause. Falling of gross domestic product of the USA in 3 quarter was the most considerable for 7 years. FRB chapter San Francisco Dzhanet Jellen has noticed that last macroeconomic data "causes serious anxieties" and it seems that USA  gross domastic product will essentially reduced in the fourth quarter. Also, in its opinion, "inflationary risks have strongly decreased". She could not tell, when the basis in the habitation market and consequently plans of the additional direct help to house owners "deserve serious consideration" will be reached. All specifies that propensity to risk at investors will remain, but positive and yen it is not enough for dollar. BUT it becomes a reference point next week for now against growth of the share market and decrease in % of rates under credits the dollar will decrease under the relation to all currencies except yen.

JPY. Japan bank has lowered the rate overnight to level of 0.3 % from a mark of 0.5 %, while the rate under credits provided with securities or other liquid actives, to level of 0.5 % from a mark of 0.75 %. For stimulation of liquidity of bank system the decision to pay percent on additional reserves of commercial banks was accepted. The chairman of Japan Bank has promised that the monetary and credit policy remains soft before restoration of economy rates increase, having noticed that problems in the world financial markets only have started to influence home markets of Japan.

EUR. The participant of Operating Council of European Central Bank Migel Anhel Fernandez Ordonez has refused to make comments on the size of possible reduction ECB key interest rate during session next week, but has put in the forefront sharp decrease in rates of  inflation increase in Spain and Germany. In Spain annual inflation become weaker for a month from 4.6 % to 3.6 %. In Germany in October inflation has decreased on 0.2 % for a month. Ordones named these given by the important signals, therefore reduction of ECB rate becomes in doubt. After sudden reduction of the rate at session on October, 8th on 50 basic points it makes 3.75 %. However the choice at ECB is not present - all indexes left on Thursday show falling of business activity and global approach of pessimism in eurozone economy. ECB Councillor Weber has declared that problems in the markets have been underestimated also the crisis phenomena within last weeks have amplified. On this background euro strengthening looking illogical, but on Friday or Monday it is not necessary to expect sharp jumps. All wait ECB session.

GBP. The prices for habitation in Britain have fallen 12th month successively in October, having shown record annual falling of 14,6 %. For a month of the price have decreased on 1,4 %, hardly less, than in September of 1,5 %, but this figure has appeared above forecasts of economists. The prices for houses depend on fluctuations of transactions. The approved demands for credits for houses buying have fallen to a new minimum in 3 quarter. Britain under forecasts will enter recession this year after gross domastic product in 3 quarter has shown negative value for the first time since 1992. Last data on the hypothecary market has shown the minimum growth of the approved demands for the hypothecary credit in September 1000 to 33 000 with 32 000 in August - a record minimum.

AUD. The Australian government is not ready to support second wave of world decrease in rates. One of Australia Reserve bank heads has declared that high inflation in the country can limit the monetary policy in the field of interest rates. An index of advancing indicators in August of 0,4 %, the previous value of 0,0 %. Strengthening of the Australian still under the big question. While only the prices for commoditive materials provide it.