International News

China asks Nepal to be part of its Silk Road 

Kathmandu, Feb 28 (PTI) China these days requested Nepal to be a part of its bold Silk street initiative, which, it claims, is geared toward regional connectivity.

China made the request all through the 14th annual time-honored assembly of Nepal-China Chamber of Commerce and Industries here.

more than a hundred international locations have shown activity within the Silk highway initiative and signed Memorandums of understanding (MoU) with 40 international locations, chinese language officers observed.

chinese language Ambassador to Nepal, Yu Wong, requested Nepal to support in forwarding the Silk highway initiative. He observed, “it’s going to assist in regional prosperity and connectivity.” Nepal’s Deputy prime Minister and Finance Minister Krishna Bahadur Mahara pointed out his nation would extend alternate ties with China protecting the geopolitical sensitivity in view.

“I assure you that Nepal will make extra resolution to augment exchange members of the family with China,” he spoke of, but delivered that exports need to be expanded to reduce change losses.

He additionally thanked China for its counsel to Nepal’s infrastructure construction.

China has assisted Nepal within the areas of Hydropower, Aviation, development and Transmission line, Yu stated, assuring that such guidance will proceed in future.

 

President Donal Trump First Day in office

In  American history is playing out before our eyes. It began Friday on the Capitol steps with the inauguration of President Trump, and it continued yesterday on the streets of Washington and other cities around the country and the world. Chip Reid reports on one part of our Cover Story:

“I do solemnly swear that I will faithfully execute the office of President of the United States, and will to the best of my ability, preserve, protect and defend the Constitution of the United States. So help me God.”

donald trump in office.png

On Friday, January 20th at noon, Donald John Trump took the oath of office to become the 45th President of the United States.

After being the Donal president, let us see the movement of financial markets.

Financial markets gave a relatively muted response to Donald Trump’s inaugural speech as US president Friday, with US stocks edging higher, Treasuries putting in mixed performances and the dollar easing back against its main rivals. In what I’m sure will turn out to be a truly historic day in the modern history on the United States market participants seemingly decided to watch from afar as volatility all but disappeared and markets resembled the proverbial millpond, but today marks the new presidents first proper day behind the desk and nobody knows what will happen.

Friday belonged to Trump, as he finally took the keys of the White House following one of the most bitter elections in US history. His victory in November fueled a strong rally for US stocks and the dollar and a steep sell-off for Treasuries amid a surge of optimism that his promises of fiscal stimulus, infrastructure spending and lighter regulation would bolster economic growth and corporate earnings and prompt a faster pace of US interest rate rises.

While Mr Trump’s first speech after his election victory had struck a noticeably conciliatory and “presidential” tone, Friday’s speech was a big departure.  He criticized the establishment who were standing right next to him, he expounded the benefits of ‘America First’, and his speech struck multiple notes on protectionism, from manufacturing, trade, jobs, defense and foreign policy. Mr Trump’s first address as president gives investors a lot of food for thought. Much of that thought is likely to be directed at what Mr Trump achieves in his first 100 days in office.

The post-election story in markets has largely been about what campaign promises turned into reality could do to a US economy already several years into a recovery. The possibility of tax cuts, higher inflation and appointees to a Federal Reserve more inclined to raise interest rates has led to higher bond yields, a stronger dollar and record highs for stock market indices, but disappointment may follow if legislation fails to appear with the same frequency as presidential tweets.

Philip Marey, senior US strategist at Rabobank, sounded a note of caution about the potential impact of Mr Trump’s plans. “Increased government spending and lower tax revenues may push up the public debt trajectory,” he said. “This could hurt the long-term outlook for the US economy. What’s more, Mr Trump’s trade policies could backfire rapidly and undermine the positive impact of his fiscal policy initiatives.”

The dollar turned lower in the wake of Mr Trump’s speech, trading 0.3 per cent down against a basket of currencies, as the euro edged up 0.2 per cent to $1.0688 and the US currency slipped 0.2 per cent versus the yen to ¥114.57.  A trend that continued this morning as Asian markets focused on the US dollar, which weakened against an array of regional currencies as haven investments including bonds and gold made gains in the wake of Donald Trump’s first speech as US president.

The dollar index was down 0.4 per cent in Asia. The Japanese yen led the ascent against the dollar, strengthening 0.9 per cent to ¥113.60. The Mexican peso was 0.8 per cent stronger at 21.4207 per dollar, while the South African rand firmed 0.7 per cent to R13.4985. Currencies across Asia Pacific also made gains, with the New Zealand dollar rising 0.4 per cent against its US counterpart to NZ$0.7197, while the Australian dollar was up 0.2 per cent at A$0.7568. The onshore renminbi was 0.4 per cent stronger at Rmb6.8480 against the dollar after China’s central bank set the currency’s daily trading band 0.2 per cent stronger, while the offshore rate rose 0.3 per cent.

Closer to home it is an important week for Sterling and there is likely more volatility to come, but not to the same extent as last week when pre-speech briefing sent the pound down far enough that it then rebounded 3 per cent in one day, after Theresa May set out her principles for negotiating Brexit.

Theresa May will set out her vision for Britain’s industrial future on Monday, promising to boost “world-leading” sectors while “closing the gap” between the most productive industries and places, and the rest. The strategy will set out 10 “pillars” that underpin the government’s approach, including infrastructure, procurement, skills, access to finance and management, and affordable energy.

Tuesday sees the Supreme Court hand down its decision on whether the High Court was right to rule that the government had to consult parliament before sending the formal Article 50 letter, which triggers the UK’s two-year exit from the EU. If the court rules against the government, it presents the prime minister with a logistical problem, and a possible delay as she seeks approval from MPs and the House of Lords.

The initial High Court ruling boosted the pound, so ratification by the Supreme Court may have a similar, though modest, impact. Then comes the first estimate of UK GDP in the fourth quarter, which will reveal whether post-Brexit resilience in the economy is holding. Friday’s poor retail sales knocked 0.6 per cent off the pound’s value against the dollar, evidence that rising inflation is hindering the economy. Even without any Trump effect on the value of the dollar, sterling volatility remains in play.

The week closes out with Theresa May meeting President Donald Trump in Washington.

EUR/USD – Current Price $1.0742 (+$0.0040)

The USD continues to trade on the defensive this session after President Trump’s inauguration speech raised concerns about potential protectionist trade policies. EUR/USD which slid to an early low near $1.0680 has bounced back to clinch a daily high of $1.0755 ahead of pan-Eurozone consumer confidence and speeches from ECB President Draghi and Chief Economist Praet. From a technical view, we look for resistance around the $1.08 round figure mark followed by the December 8th high at $1.0874. On the downside, the overnight low at $1.0686 and Friday’s low at $1.0625 are in focus.

GBP/USD – Current Price $1.2356 (+$0.0081)

Cable also attracted a bid at the start of the week with President Trump and PM May this week set to hold talks over a US-UK trade deal that cuts tariffs and allows workers to move between the US and UK. The pair rose to a high of $1.2445 after light stops above $1.2425 were tripped but selling from a UK Clearer saw it ease back towards the $1.2405 level before bouncing back to fresh daily tops above $1.2470. Above here, we look for resistance around the December 16th high at $1.2509 followed by the December 15th high at $1.2568. On the downside, a break below the overnight low at $1.2331 would aim for the January 9th high at $1.2278.

USD/JPY – Current Price ¥113.49 (-¥1.13)

A sharp drop for USD/JPY at the start of the week, the rate fell towards ¥114.00 initially, but stabilised around ¥114.25 and nearly covered the gap down before Tokyo morning selling saw a more extended drop, under ¥114.00 and then continuing to fresh lows in the ¥113.20 region as selling pressure around the greenback gained traction. In terms of technicals, Tuesday’s low at ¥112.57 is our first level of support followed by the November 30th low at ¥112.06. On the upside, Friday’s low at ¥114.21 and the overnight high at ¥114.49 are in focus.

GBP/EUR – Current Price €1.1587 (+€0.0025)

Sterling appears to be benefitting from the negative focus elsewhere today, as concerns over the likeliness of a hard Brexit have somewhat diminished after PM May’s speech last Tuesday. That said, we are looking to tomorrow’s Supreme Court decision on whether May or the Parliament has the power to trigger Article 50. Anyway, GBP/EUR rose to an early high around €1.1570 but selling saw it ease back under the €1.1550 level bouncing back to print daily tops above €1.1600. From a technical view, Thursday’s high at €1.1614 is our first level of resistance followed by the January 9th high at €1.1650. In terms of support, Friday’s low at €1.1531 and Wednesday’s low at €1.1485 are in focus.

In this way, we have to think about the economic of Nepal and Nepalese per capita income.

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