WEBODIGY Business & Finance Journal

Japanese Finance Minister Hirohisa Fujii said, the United States dollar (U.S.) is still the strongest currency in the world. Naturally, if the Tokyo maintain a large stock of foreign reserves in U.S. dollars.

“Clearly, the U.S. dollar is still the strongest currency in the world,” Fujii said at a press conference yesterday. “This is what causes nations to maintain foreign reserves in a strong currency. It also contributes to further strengthen the U.S. dollar,” he added.

Currently, Japan is the second largest country after China in the possession of foreign exchange reserves in dollars AS.Tokyo not give details on the amount of foreign exchange reserves in dollars AS.Tapi, most believe Japan’s foreign reserves rose as a result of the strengthening yen intervention in the past.

Japan is believed to sell the yen as an effort to muffle the strengthening yen. Fujii said, Japan should not try, artificially, to weaken their currency to boost export competitiveness mereka.Namun, he also emphasized that Japan does not support the excessive strengthening of the yen.

In London, the euro exchange rate against the U.S. dollar rose to the highest position during the last 14 months. Euro traded at the price of USD1, 5035 or rose from the position on Friday (23/10) at $ 1, 5007. Forex traders argue, pushed the euro to strengthen China-step increase ownership of the European currency.

While in Asia, the euro on Monday (26/10/2009) traded in the $ 1 level, 5064, or through the highest level on 11 August 2008.Nilai dollar against the yen on Monday, weakened to 91.76 yen from the day position 92.07 yen Friday. “Related financial news Central Bank of China (PBOC) is obtained from the research report said China will increase ownership euro and yen,” said analyst Brian Dolan Forex.com.

“As a result, the euro exchange rate against the U.S. dollar rose to the highest position in the last 14 months.” China has increased investment for his own foreign exchange reserves worth $ 2, to 27 billion U.S. government bonds. Beijing is also trying to diversify its investments into other currencies to increase yields during the global financial crisis.

The Mexican peso is benefiting from the U.S. economic outlook for 2010, as Mexico has the U.S. as the main destination for its exports, both raw and manufactured, and an accelerated growth of its neighbor is helping Mexico’s currency to gain in foreign-exchange markets.

The peso continued to profit today from a better confidence towards its main trading partner, the U.S., as well as for increased crude oil rates, since the Latin American nation is one of the main oil suppliers for the U.S. together with Canada, helping the peso and the loonie to trade high in the beginning of 2010.

USD/MXN traded at 12.8190 as of 20:13 GMT from an opening rate of 12.8750.

The Romanian leu rallied today versus the euro and the U.S. dollar as interest rates were unexpectedly cut in the country after a political crisis that delayed an IMF bailout finally ended, adding confidence that stability in the parliament will lead the nation towards a faster recovery.

After interest rates were cut today to 7.5 percent at the lowest level in a year, the leu rose versus most of the main currencies, as a political crisis ended regarding disputes that affected the process of obtaining and using a $30 billion bailout provided by the International Monetary Fund to the Eastern European nation. The optimism regarding better economic days for Romania with political stabilization helped the leu to rally today.

EUR/RON closed at 4.1838 from an opening rate of 4.2137. USD/RON ended the day at 2.9033 from 2.9139.

The pound lost versus several key-currencies today and specially versus its regional rival, the euro, as traders speculate that U.K.’s financial authorities will insist in quantitative easing measures to stimulate the British economy, affecting the sterling outlook in currency markets.

The British currency posted a declining session versus most of the 16 main traded currencies two days before a Bank of England policy makers meeting, where, according to analysts, the current asset purchasing program will not be suspended, declining even further attractiveness for the pound, as the recession in the U.K. remains rather significant and measures are necessary to attempt starting a faster economic acceleration in the country. Even if the real estate market is providing positive data in the U.K. since November, the sentiment regarding the economic future in the nation is rather misty, stopping the pound to advance in foreign-exchange markets.

U.K.’s central bank strategy is following a different, and dovish, path than most of the wealthy nation’s policy makers. While interest rate hikes talks are a global trend, in the U.K., quantitative easing extensions are still possible, and this has a intense impact in the pound’s rates.

EUR/GBP traded at 0.8979 as of 19:10 GMT from a previous reading of 0.8945 yesterday. GBP/USD traded at 1.5983 from 1.6090.

The yen managed to gain versus most of the 16 main traded currencies today after a negative U.S. housing report brought risk aversion up among investors, which opted for the safety provided by the Japanese currency.

The Japanese currency gained the most in four weeks versus the greenback as a pending home sales report frustrated forecasts and indicated a monthly drop of 16 percent, declining risk appetite and favoring the Japanese currency, even if the actual figures are still positive in the annual comparison. The only currency that manage to contain the yen’s advance was its neighboring South Korean won, as the emerging market currency is rated among the best bets for 2010 according to analysts. Speculations that Japanese investors would be repatriating assets today also helped the nation’s currency to post a splendid performance today.

U.S. housing data affected both the greenback and risk sentiment in trading markets, which is good for the yen, according to traders. Bets that the Federal Reserve will raise interest rates also declined, allowing the yen to become more attractive among the 6 main traded currencies in the short term.

USD/JPY dropped to 91.45 as of 17:00 GMT from a previous rate of 92.60 in the intraday chart. EUR/JPY touched 131.71 from 133.61.