Currency markets in turmoil as global stocks plunge

Seattle News.Net
Monday 6th October, 2008

Foreign exchange markets are experiencing violent gyrations Monday amidst global markets turmoil.

The Japanese yen was being quoted at little more than 100.00 yen to the U.S. dollar in a meteoric rise as carry-trades were being unwound in dramatic fashion.

The Australian dollar, which was trading at more than .8500 cents two weeks ago, on Monday was fetching .7000 cents, a fall of nearly 18%.

The euro, which was more than 1.4500 a week ago, on Monday was quoted at 1.3400, a fall of nearly 8%.

The Canadian dollar weakened to 1.1000 and the British pound to 1.7300.

The wild swings came as fear grips global markets. The U.S. 2-year Treasury bonds were yielding just 1.40%, in a flight to safety. The 10-year yield fell to 3.44%. Stock markets plunged in Asia, the Middle East, and Europe.

When Wall Street's opening bell was sounded, before the din stopped ringing the Dow was down more than 300 points.

At the close of trading it was down 363 points.

The benchmark index in Brazil, the Bovespa, was down more than 15% at one stage. The Paris-based CAC 40 closed down 9.04%. The German DAX shed 7.07% of its value. London's FTSE 100 was off 5.77%.

In Asia the biggest mover was Indonesia's Jakarta Composite which fell more than 10%. In China the Shanghai Composite closed down 5.23%. In neighbouring Hong Kong the Hang Seng was down 4.97%.

The Australian All Ordinaries closed 3.36% lower.

Have your say on this story