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Strategies & Market Trends : Asia Forum -- Ignore unavailable to you. Want to Upgrade?

To: Michael Sphar who wrote (5431)	8/11/1998 5:30:00 AM
From: Bosco	Respond to of 9980

G'day all - dear Michael, you sez "Good to know where they put their trust, faith, and confidence..." My personal interpretation is the PRC tries to talk a good game. Maybe they have stolen a page from Mr Alan Greenspan's playbook <G>. They are notorious poker's face anyway, but here, they really want the US to do the cleanup job for them. best, Bosco

To: Michael Sphar who wrote (5431)	8/11/1998 6:41:00 AM
From: MikeM54321	Read Replies (3) \| Respond to of 9980

Thread, I didn't realize that the Chinese would insist on a stronger yen while at the same time sell it. Is China telling other countries to take a hit on the yen, but China won't volunteer? I understand they are not selling the yen directly. The article says, "yen-denominated bonds." So I guess it's not the same thing? Can anyone explain. It appears, on the surface, it's just like selling the currency directly. MikeM(From Florida) ____________________________________ Dollar Rises to 8-Yr High vs Yen After Japan Says its Slump is Deepening London, Aug. 11 (Bloomberg) -- The dollar rose for a third day against the yen, reaching an eight-year high, after Japan said its worst recession since World War II is deepening. ''There is nothing on the horizon in the near term that could prove yen-supportive'' apart from government selling of dollars for yen, said James McKay, chief economist and currency strategist at Commonwealth Bank of Australia. ''It probably won't be long before we see 150'' yen per dollar. Concern China may devalue its yuan drove the currency to near a five-year low on Shanghai's black market. China's central bank has bought yuan for dollars for three straight days to support the currency. Grimble at Norwich Union said he's concerned about a Chinese devaluation because of ''the message it would send about where China's economy is and the impact on other Asian countries.'' A devaluation would also dent worldwide consumer demand since it would reduce the purchasing power of the world's most populous country. The prospect of a weaker yen prompted China to sell billions of dollars worth of yen-denominated bonds to keep its foreign exchange reserves from losing value, the Financial Times reported, citing an unnamed Chinese government official. China cut its yen holdings to below a quarter of its $140 billion foreign currency reserves from a third and could sell more if the yen keeps falling, the newspaper said. The yen has fallen almost 12 percent this year, with its losses prompting the Bank of Japan and the U.S. to sell dollars for yen June 17 to support the Japanese currency. The joint action lopped as much as 13 yen from the dollar's value in the following three days. The effect didn't last, though. It's since regained those losses and more.