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Strategies & Market Trends : Mish's Global Economic Trend Analysis -- Ignore unavailable to you. Want to Upgrade?

To: RealMuLan who wrote (16955)	11/27/2004 9:58:22 PM
From: RealMuLan	Read Replies (1) \| Respond to of 116555

Asia frets as currencies near pre-crisis levels SINGAPORE: The conventional wisdom is Asian central banks are holding back currency strength to protect their exporters. Analysts say they could also be driven by a sense of deja vu as the South Korean won and some other Asian currencies approach levels last seen before the 1997/98 financial crisis. They’re worried about excessive gains in their currencies lest they be dragged down later as global growth slows. dailytimes.com.pk

To: RealMuLan who wrote (16955)	11/27/2004 10:59:44 PM
From: mishedlo	Read Replies (1) \| Respond to of 116555

Meanwhile Europeans have reason to suspect that Asian central banks had been major players in driving up the euro while resisting appreciation themselves. A crucial but little noticed paradox of the past two years has been that the strength of the euro has coincided with a sharp fall in euro-zone foreign reserves. This suggests that Asian central banks had not just been shifting reserves into euros but had been covertly buying euro-zone bonds through commercial banks. Meanwhile, lower euro reserves limit Europe's ability to undertake some covert intervention of its own to force up Asian currencies.