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The Reserve Bank of India kept the key policy rates unchanged for the second time in a row but it clearly mentioned that the fight against inflation was far from over
An eye-popping U.S. nonfarm payrolls number on Friday along with a services industry rebound in January sent the dollar to a mid-January high, with investors pricing in the Fed's policy rate peaking at 5.05% in June.
MSCI's 50-country world index has added more than $10 trillion, or 20 percent, thanks to COVID recovery signs and the torrent of central bank stimulus that has continued to flow. The S&P 500 has gained 27 percent, while the tech-heavy Nasdaq is up 22 percent.
Spot gold was down 0.2% at $1,741.19 per ounce by 0430 GMT, having dipped as much as 0.7% earlier in the session. U.S. gold futures were down 0.1% at $1,740.20 per ounce.
The dollar was trading 12% higher on the lira at 8.100, but that was off an early peak of 8.4850 amid speculation Turkish authorities would intervene to stem the rout.
Turkish President Tayyip Erdogan's spokesman said Washington must respect the legal process concerning the pastor, Andrew Brunson.
We maintain a view of further weakness in the Indian rupee and if we see the fundamentals deteriorating on the deficit front and on the fiscal side before elections then we could see the pair inching towards 72-73 soon.
The benchmark 50-stock Nifty index is up 8.5 percent for the calendar, despite the rupee depreciating 9.23 percent against the US dollar.
Turkey was in the same league as India and China and among the fastest growing economies in the world, but addiction to cheap money has destroyed its foundation
The US dollar strengthened against the would currencies after the Turkish Lira dived almost 8 per cent, sparking a sell-off in global markets.
Compounding the lira's agony, President Donald Trump said yesterday he had doubled steel and aluminium tariffs on Turkey, noting that relations between the NATO allies were "not very good".
Over the past week, Turkish President Tayyip Erdogan`s administration has lashed out at the central bank, urging it to aggressively lower interest rates to shore up economic growth ahead of general elections in June.
Some are predicting a big jump in China equities. JPMorgan expects a 15-20 percent rebound, to an implied 10 times earnings, in coming weeks as focus shifts to two key political meetings which should kickstart the country`s reform agenda.
For much of 2013, the investor narrative was that currencies and stock markets from Mumbai to Moscow and Istanbul to Johannesburg were running aground as Federal Reserve largesse ebbed away.
Emerging market economies are bigger and more closely linked to developed market economies than ever before and the term can seem increasingly obsolete when applied to a country like China -- the world's second biggest economy.
The bank raised its overnight lending rate to 12 percent from 7.75 percent, its one-week repo rate to 10 percent from 4.5 percent, and its overnight borrowing rate to 8 percent from 3.5 percent - all much sharper moves than economists had forecast.
One-month implied volatility, a gauge of expected swings in some emerging market currencies and derived from options prices, has jumped to its highest in years, reflecting investor nervousness.
This is its record low and makes place for itself in one of the worst performing currency space along with the Brazilian real. The currency is down around 15-16 percent all the way since May 22.
The prospect of a central banker from the land of the lira, "a currency with a ludicrous amount of zeros" in which a bus ticket used to cost over 1,000 currency units was less than appealing.
It's all a far cry from a year or so ago, when emerging market exporters were battling rising exchange rates and Brazil was accusing Western policymakers of waging currency wars by flooding the world with cheap money.
