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Since 1992 Vietnam is struggling with the issue of rising prices of over 25 percent encouraging the distress that the dong will lose is importance with the standard stock index continues its losing events. In the previous month majority of the rating agencies have decreased what they think about the country’s debt referring to the slow government action against the rising prices. The government in a try to decrease the consumer price profits the economic growth was slashed from seven to nine percent.

According to a statement that was posted on the government’s website saying that in the year 2009 they are aspiring for the growth to be 7.3 percent. Prime Minister added that the government has enough foreign currency that they will easily be able to interfere in continuing the value of the dong and also the imports.

Mr. Dominic who is the director at Dragon Capital, an investment company at Ho Chi Minh was of the view that the government is very much aware of the situation and they are making the people aware of what are the steps that they are making for it. Government is making necessary progress in recuperating the dong value. The currency made a progress of 0.02 percent taking up to 16,285.48 per dollar. Since August the dollar has gained as compared to the dong for the three months which is considered to be the longest streak. Going by the website the reference rate that was fixed by State Bank of Vietnam was 16,137 a dollar as compared to 16,130 which was on Monday.

On Tuesday the Stock Index of Ho Chi Minh crashed down to 1.46 percent which will easily lead to inflation and will to the selling of the local assets forcing the dong to fall. For the current year the standard loss has been more than 50%. According to the government kn the first five months for the current year the balance of payments illustrated an additional of $1 billion.

On May 28 Morgan Stanley made a statement that Vietnam will be facing currency emergency and the country’s deficit rate might increase. Same predictions have been coming from Deutsche Bank AG forecasting the deflation of dong with the increasing prices. According to General Statistics Office as for the first five months the trade gap stretched to $14.40 billion.

The statement was disclosed only after the meeting with the Prime Minister and Mr. David who is the head of marketing research with JP Morgan Chase & Co. Last week Mr. Phuc was of the view that they are not in need of any funds yet from IMF (International Monetary Fund). This prediction was made when Deutsche Bank made a prediction that the country might have to adopt IMF program for the coming months due to the lack of foreign funds.

Mr. Nguyen who is the director of external financing with Vietnam’s Ministry of Finance was of the view that the foreign currency funds of Vietnam said raised around $20 billion from $18 billion by the end of 2007. He also added that the funds will more by the end of the year.

The business of the oil was about to reach to the closing point but suspended to move further in the middle of the further supplies, worldwide demand, and the growing tension in the Middle East. The crude oil gained a raise of 27 cents coming at $134.60 a barrel and previously it rose to more than $135. Following last week’s gain the market is taking time out and according to Mr. Victor who is an energy analyst working with Purvin and Gertz in Singapore said that there are still chances of the market to further rise.

International Energy Agency didn’t show any interest towards the demand for the oil in the international market due to amid surging prices. Mr. Victor was of the view that supplies might be effected in a situation where Atlantic hurricane season effecting the production levels in Gulf of Mexico. After the Israeli cabinet minister gave a warning of the attack on Iran it put off the markets.

Mr. Ehud who is a Israeli Prime Minister didn’t shared any comments and the minister also had not being put across the policies of the government. It all began after Mr. Jean-Claude stated that the bank could increase the interest rates to face inflation. Crude oil prices reached to $139.10 a barrel which is quite high. On Monday the prices move back when the dollar got better than euro after the comment made by Mr. Henry who is Treasury Secretary. Late Monday the euro was on $1.5649 to $1.5570 in New York.

According to Mr. Addison who is the director of market research with Tradition Energy at Connecticut a blast that took place at a natural gas production unit in Australia raised that demand for diesel in that area. Mr. Addison said in Nigeria one of the important oil suppliers for America could face a strike which means that they will loose more than 448,000 barrels of oil which is major setback to the market. According to IEA they predicted that international demand for oil in the year 2008 will see an increase of more than 0.5 percent.

It is because of the increased oil prices majority of the developed countries were in favor of decreasing the fuel subsidies. The data of both 2006 and 2007 have also been modified, along with the reduction in the international demand for barrels per day previous month. The agency is continuously decreasing their demands for past couple of months with oil rising at a faster rate.

For Nymex trading the oil futures rise by 2 cents to around $3.8988 liters, Gasoline prices also raised at $3.4015 a gallon, and as for the natural gas at $12.607 per 1,000 cubic feet. July Brent crude decreased 62 cents to $133.26 a barrel on London’s ICE Futures Exchange.

On a stronger dollar the prices for the oil witnessed a downfall and talks have been conducted on the rising oil prices. On the other hand the price for gas is witnessing a constant rise leaving behind the $4 mark. After Mr. Paulson who is the Treasury Secretary gave a comment that he is not denying the interference to make the American currency steady the dollar witnessed an improvement as compared to the euro.

Seeing the rising prices of the oil all the countries engaged in producing oil were called for a meeting by Saudi Arabia. One of the Saudi minister said that they will be working along with OPEC for the supply of the oil in the present times and in the near future also. He went to add that the current rise in the price is groundless.

On New York Mercantile Exchange the price of the crude crashed down $4.19 to stop at $13.44 a barrel. It was on Friday that the oil witnessed a record breaking rise of more than $9 in just one day, but on the other hand the gas didn’t stopped and kept on rising. According to Oil Price Information Service and AAA the average price of the gallon across the nation rose by more than 1.6 cents and reached to $4.021. Even though some parts of the country paid the price for weeks now but it was on Sunday that average crossed $4.

Mr. Tom who is a chief oil analyst and publisher at Oil Price Information Service in Wall, New Jersey was of the view that if the oil stayed near $138 a barrel you can still expect the gas prices to rise in the coming days. According to a spokesman of AAA the prices will still rise to 2 to 3 cents. With the gas prices going up where some of the drivers have cut back on the other hand the gas producers will have to raise the prices seeing the prices of the crude oil also increasing.

The rise in the gas prices has already made the drivers to change the type of cars they used to drive or they are planning to buy. Seeing all this General Motors has also made an announcement last week that that they will be shutting down their four units engaged in producing pick-up trucks and SUVs.

It will be really a costly affair if you have a SUV which costs around $90 to fill it up not to mention if you have to pick and drop your kids to school. Around Memorial Day the prices of the gas often witness a raise and then move back in the summer time. After last week when Mr. Trichet who is the President of European Central Bank made a comment on the rising interest rates in the month of July to face price rises the sharp rise was witnessed. This made the euro to easily rise against the dollar.

In an interview Mr. Paulson said that he don’t deny the fact that they are interfering to make the dollar stable but he refused to make any comment on what will be the government reaction towards this issue. Mr. Paulson’s comments made an impact on the euro to decrease sending oil crashing down.

As a result of G7 summit Euro which was ahead as compared to the Dollar last week came down. It is evident that the Euro closed more than 1.575 mark on Friday but G7 summit is blamed for its drop. As the dollar is getting more admiration there are chances that G7 might show an involvement in it. Seeing the apprehension on the frequent variation expressed by the Group of Seven the Dollar which has noticed a one week-high as compared to the Euro. This followed a fall of more than ten percent over the previous year.

For the first time the G-7 altered their statement as compared to the currencies in four years. This happened after the meeting that took place in Washington on April 11 where it was promised to check the exchange markets cautiously. The Euro slashed down as compared to the Yen and it cut down losses as compared to the dollar in the Asian stock market. As a result the shareholders had to slash down the holdings for high-yielding possessions that are invested in Japan.

It was noticed that the dollar have risen more than $1.5765 per Euro from $1.5808 on April 11 in New York. It arrived at more than $1.54 which is considered a strong level to reach since April 3.

A currency analyst by profession with RBC Capital Markets which is a investment banking unit of Royal Bank of Canada at Sydney Mr. Sue was of the view that for a shorter period the G-7 communications will be momentous. He also added that involvement is bound to happen and different speech is expected. He said that he will anticipate to the reinforcement of the dollar in coming weeks. The currency also underwent a change as 100.87 yen from 100.93. The yen witnessed a raise to 157.72 per euro from 157.54.

Mr. Sue said that this week there are chances that US currency might increase more than $1.54. Mr. Akio who is a chief manager of foreign exchange trading in Mitsubishi UFJ Trust & Banking Corp in Tokyo said that the traders will be unwilling to push the dollar more down yet there are probabilities that it should fall. By assets it comes at second place as a unit of Japan’s largest banks.  

He added that the dollar will increase to 1102.18 yen and $1.54 euro today. According to Median forecast of thirty-six economists in a Bloomberg News Survey the consumer prices of Britain are expected to rise an annual 2.4 percent. The office for National Statistics will be releasing the producer price statistics today and afterwards they will be producing figures for price rise tomorrow in London.

It has been noticed that Bank of England has slashed the interest rate by 0.23bp and it’s been the third time since December that they have slashed the price. There has been a talk that the conditions have got more constricted which has created a danger of slow economic growth.   Those who enjoy the authority are busy in creating a balance of the danger of sooner price rises determined by high costs of food and energy as this will gain a grip in the economy. It was earlier today that the Pound was reportedly traded at a minimum of 1.9652 against the US dollar and is trading at 1.9707 lately. 

Following the meeting of Group of Seven today which lowered the metal’s plea as an optional investment, the gold came down by more than one percent with as euro came down against the dollar. From Platinum, Palladium, and silver they all witnessed a fall of three percent. The platinum slid down below the two thousand dollars an ounce and as for the silver it dropped to a ten day low.

The gold before increasing to $920.48/921.18 it slipped to $914.08 an ounce against $924.58/925.38 in New York. On March 17 it reached to $1.0380.78 which is a record. According to Mr. Tom who is a metal strategist at Mitsubishi Corp until the euro/dollar duo break from its position of $1.5548-$1.5858 lately these costly metals will probably persist to tread water.

The Bullion investors are still optimistic for a time period to a maximum of six months. But they would like to warn that if more liquidation is continued then that it could result to distress in the selling of the merchandise in the coming future. Asian shares are also dropping and for the fifth time in succession the European stocks are also falling. The euro slashed down as compared to the dollar following the Group of Seven showed a major concern for the major changes in the major currencies across the world.

The profits were also restricted with the constant fears that directly concern the economy of America. The euro was at last at $1.5806. A firm dollar formulated in making the gold more valuable for the bearer of other currencies and regularly slashes bullion demand. The oil became easier to trade i.e. around $108 a barrel.

Not able to stay over the main level of $928 encouraged the investors to do more business. For making their future marketing decisions they are awaiting this week’s American data for retails sales, prices for the producer, quarterly earnings by the banks in America, and consumer prices. There are some analysts who are of the view that the there are chances that the gold will make progress.

According to a report of Standard Bank there are probabilities that purchasing a good deal might raise the prices forward seeing the nervous week. The gold enjoys a support at $912 along with $908 and $902 as prospects. As for the other markets, American gold for the month of June delivery slipped down $2.48 to $924.48 an ounce. Platinum slashed down to $1938 an ounce and was last estimated at $1946/1956 against $ 2000/2005 late on Friday which concluded a feeble gold.

It was on March 4th when it touched a record high of $2288. Staying optimistic Citigroup Global Markets and increased the forecast prices for platinum to $2003 an ounce in 2008 and $1798 in 2009 as compared to their early forecast of $1694 and $1498 an ounce.   

According to a market report it has been said that the decision for the platinum price that is kept over $1998 during the first quarter of 2008 has successfully created a standard for the prices of the metal. The silver also noticed a downfall of $17.23 an ounce before it rose up to $17.49/17.54 an ounce against the $17.73/17.79 in New York. The Palladium also witnessed a downfall to $454/461 an ounce to $464/472.  

With the news of forced liquidations, true reports, and missed margin calls the treasury yields and S&P 500 slashed down to 50 week low. Yields of two year were slashed down to around 11.0 bps to 1.50 percent and yields of thirty year were down from 4.0 bps to 4.55. The contract of Eurodollar for the month of June increased up to 13.4 ticks to 97.62. It slashed from 29.32 points to12040.37. Dow Jones Industrial Average closed 214.57points to 12040.37. The NASDAQ crashed down 52.9 points to 2220.47. S&P TSX index of Toronto closed 234.6 points to 13369.22.

Some of the prior jobless assertions, incomplete home sales, and sales of the chain store were included to the different American economic indicators and they were all quite good. Some of the market analysts have reacted to the news that one of the mortgage fund Carlyle Capital Corp have failed four of the margin calls and possess more than twenty billion dollars as liability that has been subjected by Freddie Mac and Fannie Mae of GSE.

The equity and the fixed income cemented the rumors which stated that Fannie and Freddie would be granted straight government obligation debt from the American government. Mr. Richard who is a government bond strategist with BNP Paribas said that the panic was created in the mortgage market.

He also added that it all goes to show that mortgage market is not in a good position and there is not enough liquidity and also the hedge funds. Ivey Purchasing Managers Index is the latest one that is main release in Canada. Earlier in the last month it was anticipated a little weaker at 56.0 mark but landed up to 62.0.

The dollar of Canada slashed down to a quarter cent which is ahead of the figures those were projected by Ivey. Against the USD the dollar of Canada slashed down to 0.20 cents to 1.0136. Canadian fixed income didn’t give much importance to the figures issued by Ivey and the main spotlight was on data related to the Canada’s payroll. The bonds of the Canadian government also slashed down 11.0 bps to 2.52 percent. Bank of England, Overseas, and Central Bank took a decision for not making any changes in the rate of interest.

The amazing journey for the euro continues and after the verdict of ECB for not making any changes in the rates which was aimed at taking the currency downward. In the press conference Mr. Trichet was repeatedly questioned about the euro the American officials prefer the dollar. Mr. Trichet commented that euro increased of 1.5371 to 0.705 as compared to the American dollar. The euro has increased 932 pips and it is an increase of about ten cents.

At the time of closing of European stock market Eurostoxx was down at 50.76 points to 3088.00, Britain’s FTSE was hundred down to 87.09 points to 5764.40, DAX of Germany down to 90.38 points to 6590.30. As for two years returns of Germany Bunds were up by 4.2 bps to 3.29 percent. For the yields of Britain they were down at 1505 bps to 3.88 percent.

It was a surprise that the administration of Canada opened more than forty three thousand jobs in the month of February as on the contrary the American data showed a downfall of around sixty-two thousand jobs in the month of February. As per the expectations of the analysts the market of Canada’s employment for consecutively second month of February totaling of more than forty three thousand new job openings which was around fifteen percent consent by the experts.

Profits were also increased after the growth of more than forty-five thousand jobs in the month of January. With this the number of jobs for the past twelve months grew to more than forty-six thousand. Going according to the agreement the estimate made by the experts was a gain of more than two thousand jobs in the month of February. Mr. Douglas who is a Deputy Chief Economist with BMO he was of the view that the report came as a surprise and there is no worry to be made for the Canada’s domestic economy. 

On the contrary the employment data of America showed a downfall of more than sixty-two thousand for the month of February. The job figures for the month of January underwent a modification with the previous loss of around sixteen thousand jobs to the loss of more than twenty thousand jobs. It was also noted by the report that more than forty-five thousand jobs were formed in the month of December.  

The outstanding amount in The Term Auction Facility was raised to hundred billion dollars on Friday by Federal Reserve. More than forty billion dollars was raised in the auction respectively on March 10 and March 24, it is an increase of twenty billion dollars from the amount that was declared on February 29th. In a press note it was said that Federal Reserve will persist on with the auction sizes as per the guarantee and at least for six months the auctions will be continued.

American economy might require extra motivation to boost up the financial policies of Federal Reserve for increasing slow economic condition. R. Swagel who is the Treasury’s Assistant Secretary told the reporters that although nonfarm labor is poor for the month of February and the American economic basics are healthy.

According to a document released by Canadian Federation of Independent Business the owners of Canada are facing difficulties for finding workers to work on a routine basis. According to the Federation last year for four months majority of the jobs remained vacant and the employers had to face botheration in filling the vacancies. 

There were so many statements released and the speakers from European Central Bank and Federal Reserve gave their expert comments during the conference at Bank of France on the rising prices and globalization. Mr. Noyer who is Governor of Bank of France said that every country is facing the problem of inflation which has become a main hindrance in the growth.

EURUSD has reached to new heights as the pair will be reaching the landmark of around 1.5298. It is a big step when it is compared to the sudden price change where the dollar was struggling for its re-existence. The start of New York’s session quickly overcome with this attempt when it was realized the economic records generated fear that the consumer sector is no more concerned with the employment.

The American labor market data of February has really affected the report of Friday’s non-farm payroll. The reduction in the jobs was more than eleven percent and it showed that the working staff is not reduced by the companies. The fact cannot be denied that products those are related to the service segment witnessed a layoff as the government and non-profit organizations showed a rush.

It was not at all expected that the report of ADP employment will register a downfall of more than twenty thousand and it is the worst reading since June in 2003. It was evident that the goods and services segment witnessed considerable losses. The service segment to employ new employees but it is making progress at a very slow speed. It does not promise the employment of ISM non-manufacturing index and not for the NFP release on Friday.

The reduction in the employment will only add on to the already worsened American economy. ISM manufacturing gauge recorded the downfall that is the worse in the previous four years and the service segment reported deeper concerns. The print of 49.3 was registered a two point high than the standard point of around 4.6, this is a improvement as compared to the readings of the month of January which is known as the worst reading since 2001.

The world’s biggest economy is in depression and they are just waiting for a word from government’s GDP. After the ISM report came there were certain developments made while some of the developments were reducing. A significant development was detected in the business. This shift is suggestive of the inventory in the same period and the readings of the new orders and the employment were also reducing and not at al impressive.

It was a sudden surprise that the export orders shot down to more than 45 percent and the new dollar provided the reduction to the foreign consumers. Now when EURUSD has been making indecisive moves in getting further to the mark of 1.5298, the basics offer to additional worsening of the American dollar. The experts are not denying the fact for making further developments in the same area that the basics are also favorable. 

As compared to the weaker American dollar the Euro registered a hike of around 1.538 The ECB probably will be keeping the interest rates at 4.00 pct Mr. Jean will also be discussing the risk aspects of rising prices. With the rise of the energy prices it advocates that increase of the consumers will continue to quickly rise in the euro zone. There was probability that ECB will be deserting their headline rates and it remained unaffected.

Mr. James who is an analyst with CMC Markets was of the view that if there is a relaxation in the monetary policies in Europe then it seems that it will remain for sometime. When compared the data available with ADP showed that during the month of February companies of American private sector has terminated more than twenty thousand jobs and it only has worsened the issue that is mainly related to the American economy. It also suggested that Federal Reserve will be reducing more interest rates.

Mr. James was of the view that with the help of overnight trade for Euro/dollar has touched than 1.50 level and it was also assisted by the American low economic condition and it has increased the pressure on Fed to decrease the rate in the FOMC meeting.  

The data of non-farm payroll of America will be closely monitored and if the American economy’s condition remained the same i.e. weak then it will not be a good sign for the dollar and can bring future losses. On the other hand the pound also gained as compared to the dollar getting close to the two dollar level. The fact cannot be denied that it remained below the euro.

Keeping in view the inflation the again the worries for the economy has showed up and around 5.23 pct of the interest rate was also fixed by the Bank of England. Until the month of May most of the market analyst said that necessary steps would be taken for further cutting of the rate of interest. 

Mr. James was of the view that the inflation will be a matter of great concern for Bank of England but the rumor that has been going for a while in the direction of quarter point in the second quarter. It would not be possible for Bank of England to sustain a dovish position after the next rate cut and it is well maintained by the dollar.

There is also bad news from Britain housing market where Halifax reporting a fall in the prices by around two percent in the month of February.

After the rate cuts by the Fed, the prices of gold are touching the sky. It has become one of the most valuable assets after the U.S dollar. As the U.S dollar is already weakening and the prices of other commodities also falling, Gold is the only metal that is going strong. Also, the dollar index, which tracks the performance of the greenback against six other major currencies, declined 0.6% at 75.125.

Gold futures set a new record $942.20 an ounce on Wednesday, when the Federal Reserve had cut the fed funds rate by 50 basis points to 3.0%. This shows that the Federal Reserve is open for more cuts, indicating it’s concerned about the economic outlook.

With the love season in full swing, people are likely to purchase Gold for their loved ones. The owners of the Gold Companies like D’damas have confirmed that they are expecting a surge in the jewllery sales during Valentine’s Day season by 17-18% this year. This is not restricted to just India but overseas as well.

People are attracted for buying more of gold because it is seen as an alternative asset against U.S dollar. And, in the present circumstances, where dollar is facing a slump, bullion is ready to take its place without any deliberate effort. People see it as a safe and secure investment.

Inflation and improbability require insurance. Gold is an insurance against all odds. If you possess gold, it is considered as a safe option. Even if its prices go down, you don’t need to dispose it off because it is bound to rise again. And you can then make a profit by selling it at a higher price.

On the other hand, the demand of Gold has suffered due to lower imports amid high prices. The reason being that the U.S economy is seeing a set back.

The future of Gold also lays in the hands of the US CPI inflation data, which will determine the change in prices. If the dollar still goes down, then gold is likely to be benefited and will rule the market.

In addition, the prices of the base metals and oil are also lower comparatively. Platinum stands at 1783, while Palladium at 421. Silver went down at 16.76. Gold being at the zenith, 904.

Bullion is rocking and is meant to reign unless the dollar makes a comeback. So, buy Gold  and play safe.