On Tue, Sep 10, 2013 at 6:25 AM, Marv Gandall <[email protected]> wrote:
> Milestone for Yuan Marks Rise of China > Yuan Rises to Ninth-Most-Actively-Traded Currency Globally > By NICOLE HONG, CLARE CONNAGHAN and TOM ORLIK > Wall Street Journal > September 5 2013 > > China for the first time joined the ranks of the most-traded international > currencies, underscoring the rise of the world's second-largest economy and > the growth of the global foreign-exchange market. > > The Chinese yuan vaulted to ninth in the Bank for International Settlements' > latest report on foreign-exchange turnover, surpassing the Swedish krona and > New Zealand dollar, among other widely used currencies. > > Trading in the Chinese currency, also known as the renminbi, has more than > tripled over the past three years, to $120 billion a day in 2013, the BIS > said, referencing survey data from April. Daily U.S. dollar trading in 2013 > has averaged $4.65 trillion. ======================== <http://blogs.wsj.com/cfo/2013/09/19/currency-cost-u-s-companies-at-least-4-billion-in-second-quarter/?mod=WSJ_business_cfo> September 19, 2013, 4:31 PM ET Currency Cost U.S. Companies at Least $4 Billion in Second Quarter U.S. companies reported losing over $4 billion to foreign exchange swings last quarter, and currency volatility could still increase in the third quarter. Some 233 U.S. companies reported negative foreign currency impacts to their revenue and earnings in the second quarter, according to a quarterly analysis of 800 multinational companies’ conference calls by foreign exchange risk-management company FiREapps. The number of companies reporting those losses was the second-highest since the company started tracking these calls – outpaced only by the second-quarter a year ago when 250 companies cited currency headwinds. The 95 companies who quantified the impact of currency losses last quarter reported just over $4 billion in losses, up from $3.7 billion in losses in the first quarter. The losses have stemmed largely from swings in the Japanese yen, euro, Australian dollar, Brazilian real and Venezuelan bolivar, according to the analysis. “Due to the political uncertainty, the U.S. dollar, yen and Australian dollar continue to surprise,” said Wolfgang Koester, chief executive of FiREapps. “ U.S. corporations are going on three years now where they’ve had no tailwind from currencies.” Some companies have jumped into action. After an earnings hit from foreign exchange in the second quarter, laboratory equipment maker Thermo Fisher Scientific Inc., said in July it is adding $10 million to its restructuring actions to offset negative foreign exchange impacts. But despite hedging efforts, many companies are still facing a higher level of currency volatility than they are used to, Mr. Koester said. The Japanese yen fell 5.4% against the U.S. dollar in the second quarter, and is down about 15% for the year since the Japanese government has pursued a weaker yen. The yen, cited by 84 companies, was the most-frequently mentioned currency on conference calls for the second quarter in a row, followed by the euro, with 30 mentions. The biggest surprise in the quarter, however, was a swing in the Australian dollar due to elections in the country. The Australian dollar jumped to the third-most cited currency by companies in the second quarter with almost as many companies mentioning its impact as the euro. The Brazilian real and Venezuelan bolivar were the fourth and fifth most-cited currencies for the quarter. General Motors Co. cited both currencies in its conference call, saying that devaluation in the Brazilian real and political unrest in Venezuela had both caused currency swings for the carmaker. Fitch Ratings said in a note to clients this week that companies should expect additional foreign exchange rate volatility while Brazil, Russia, India and China experience growth strains. Even if companies are spending local currency to fund operations in those countries, they still face risks from the need to import special components and raw materials. “A depreciating currency can significantly raise input costs, forcing manufacturers to offset margin pressure,” the Fitch analysts wrote in the note. The Brazilian real fell 7.8% relative to the U.S. dollar in the second quarter and Mr. Koester said he expects the Russian ruble and Indian rupee to have a strong impact in the upcoming quarter. “That typically has not been area where people protect themselves since it is not a top five currency exposure,” Mr. Koester said. _______________________________________________ pen-l mailing list [email protected] https://lists.csuchico.edu/mailman/listinfo/pen-l
