Monday, May 05, 2008

Inflation rearing it's ugly head.

As we have been discussing the last inflation has been a global problem on the rise in the last year or so. Inflation is hitting the economy's in the form of higher energy pricing to start, but the trickle down affect results in higher food prices. From what I have been reading and seeing on news channels, two of the biggest worry spots are India and Egypt. Riots in the streets over food is almost common place (ok a little exagreation). But even one riot is more then I want to see. The Finance minister of India, Palaniappan Chidambaram, said

``If rightly or wrongly people perceive that commodities- futures trading is contributing to a speculation-driven rise in prices, then in a democracy you will have to heed that voice,''

The Indian Ruppee has been under pressure the last few weeks, with economist calling for a weker currency. This will only add fuel to the fire. This also is another reason why I think we have seen the last of rate cuts here and that the dollar will continue to rise.

Here it the full article from BLOOMBERG.COM.

Good Luck and Good Forex Trading



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