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Yuan
revaluation:



The possibility of the Chinese currency,
Yuan being revalued has strengthened the other Asian currencies against the
dollar.



Yunosuke Ikeda, a senior forex analyst at
Nomura Research Institute said that the Yuan revaluation would boost the export
industries of countries that have a trade partnership with China.



He also added that the revaluation would
have little negative impact on the Chinese economy. According to him, the Yuan
would have to raise 20% to 30% to have a major impact on the economy. He
expects China to revalue its currency at 5% annually.



Ikeda said that the Malaysian Ringgit and
the Singapore dollar were likely to benefit the most out of currency
revaluation and that the Australian dollar would be hit by profit taking.



The greenback is down 6 percent against the
Malaysian Ringgit, 5 percent down against the Korean Won and 4 percent down
against the Indian Rupee and the Australian dollar.



Asian currencies will further benefit from
the move to tighten the monetary policies from the Asian Central Banks.



On Wednesday, Singapore revalued its currency
sparking speculations that South
Korea and China may follow suit.



In the mid 2008, the Chinese Yuan was
pegged at 6.8 to the U.S. dollar. The Chinese economy is going strong with
11.9% growth in the first three months of 2010.



However, the U.S. dollar is struggling to
recover with disappointing data and false dawns.

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U.S.
dollar falls:


The euro was 1.3589 to a dollar on
Monday as against the 1.3497 dollars on late Friday.



The dollar gained slightly with the
Yen. It was 93.18 yen to begin with and gained to reach 93.21.



As the news about the relief package of
30 billion euro for the debt-ridden Greece hit the news market, the
euro had gained against the dollar to reach S1.3692.



The analyst also said that there are
questions about the bounce and the duration before the markets focus on the
other fiscal problems in the euro zone.



Other European countries like Portugal, Italy and Spain are
finding it difficult to raise money on bond markets. An analyst at Forex.Com
said that the EU support for countries facing economic woes was standing in the
way of strict economic austerities being implemented by the affected countries



The Euro zone deal that was implemented
on Sunday had a positive impact on the bond market. The 10-year debt paper came
down to 6.637% from the earlier 7.126%. On Monday, the yield fell to 6.498%
before gaining again.



On last Thursday, the rate surged to
more than 7.5%, the highest since it joined the euro zone in 2001.



The dollar to Swiss franc was 1.0593
and the sterling was 1.5368 to a dollar.

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