Cost of Travelling fees fees fees

What super news and finally a bank getting it together.

Chase has some great news for international travelers who are sick and tired of fees that ALL credit card companies tack on when merchants process a transaction outside of the United States of America.


This week, Chase announced it would no longer smack everyone with these heavy currency conversion fees on its United Mileage Plus Club Visa and the Continental Presidential Plus card.

Finally some credit for your efforts. If you have a Chase United or Continental card with a different name, you will probably continue to pay the fee for non-United States transactions, though you should call the company to clarify this. These guys are great in selling you additional services and products, thats the game.

While there are plenty of card companies that continue to levy these fees, the momentum is clearly swinging toward getting rid of them, thanks in part to people like you who have complained loudly and then found ways around them and people like me who never tire of pointing out how questionable the fees are.

Chase has already dropped the fees on British Airways, Priority Club and Hyatt co-branded credit cards. Citigroup has done so on select cards, and American Express plans a similar move.

So will we see this happening with localised credit card service providers in South Africa, UAE etc we will see.!!












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SA Rates work well for the UK Pound

So the weaker Rand against the pound - thats interesting.

Sterling has managed a stellar recovery against a very weak Rand since New Year.

The 9% rally in the exchange rate has been prompted by a general shift in investor risk appetite.

The high yielding currencies had been doing well in Q4, and the Rand enjoyed the same kudos as the Aussie dollar even while the South African Reserve Bank are in rate cutting mode.

A slide in the gold price (which came off its $1,430 per ounce peak over New Year and now trades around 6% lower at $1,336) impacted sentiment toward the high yielders, and as we know well from experience over recent years, these currencies tend to rise steadily and then suffer sharp setbacks when investors sense trouble.

The so called "carry trade" has been largely responsible for the inexorable rise in the Aussie dollar and Rand, and when traders unwind these positions the currencies come under short term selling pressure. A carry trade is where investors borrow in a low interest rate currency and change the money for higher yielding currencies. The bet works well as long as the high yielding currency rises. A fall in the high yield currency can cause a stampede as traders head for the exit. That's what we've seen over the last few weeks in the Rand.



In the UK inflation and interest rates were the dominant theme last week after news that the Consumer Prices Index rose to 3.7% in December, well ahead of the forecasted 3.4% rise. Retail prices (which include a wider basket of goods including housing costs) rose to 4.8%. The inflation figures prompted traders to consider the possibility of interest hikes sooner than previously expected. Then we heard this week that fourth quarter GDP growth was - 0.5%, which makes any notion of a near term rate hike extremely unlikely as the economy flirts with recession. Bank of England governor Mervyn King added weight to the case for no rate hikes when he commented that any rise in rates would not be helpful.


South African consumer prices rose 3.5% in December, giving the central bank plenty of scope to keep interest rates on hold at 5.5% at last Thursday's policy meeting. The last change in the bank's benchmark rate was a cut on November 19th from 6%.


The technical outlook is still precarious for Sterling. We've seen these sharp rallies dissipate all too often over the last few years as investors invariably head back into higher yielding assets. The market has found resistance around the 11.27 level, which marked the high back in November. If Sterling could manage a daily close above there it would open the way to our next key resistance level at 11.75. Buyers of the Rand should strongly consider covering any requirement now, locking in the 9% gain we've seen over the last 3 weeks. This has been the sharpest rally since November 2009.






Market Analysis by Jon Beddell thanks Mate!!

Money money money!!

One thing that we all want in life, would be money. the larger the amount we can get, the bigger our smiles would be:)


But sometimes, when we want something, but don't have the money, we have to get a loan. Whether it's  personal loans, a home loan or even a loan to cover that Ferrari of yours.


Some people believe that money makes the world go round, some believe that money leads to success, leads to happiness. But I've got news for you, my friend...


The road in life begins with happiness. If you're not happy without money, how will you ever be happy with it? Something for you to think about for the remainder of the day;)

Inflation jumps in the UK - Now 3.7% eeeeeish!!

So now we seeing UK inflation jumping at least 0.3% more than expected by analysts.

The Pound rallied above 1.60 against the U.S Dollar for the first time this year, while the UK currency also jumped 0.4% higher versus the Euro, after a report from the Office of National Statistics showed that UK inflation accelerated much more than initial forecasts.

Consumer prices rose 3.7% from a year earlier, despite expectations of a more modest increase to 3.4%.



Inflation has remained stubbornly above the government's 3% limit for ten months in a row and will probably accelerate further with the recent increase in VAT. The increase in prices within the UK means that the pressure is growing on the Bank of England to begin raising interest rates from a record low of 0.5%. Will this happen...well it would be interesting see what kind of gumption they have.


The BoE face a difficult balancing act in tempering rising inflation against weak economic growth. Speculation of an interest rate increase over the coming months is supporting the Pound and we may see a sustained move higher over the coming days.


The Bank of England have adopted a wait-and-see approach for the past year, but the MPC is losing some credibility for allowing inflation to remain above the government's upper limit of 3%.



Thanks to the Market Analysis by Adam Solomon from TORFX. 

US FED STIMULUS PACKAGE WHO WINS???

Well now the US makes another strange move, instead of creating jobs, they created more money.  In a report by Forex Traders;  - "The U.S. Dollar’s weak performance last week came after the U.S. Federal Reserve announced on November 3rd that they would leave the Federal Funds Rate at ‹0.25% and the new QE II stimulus package would consist of a $600B buyback of U.S. Treasury securities by the end of 2011."

So whats that mean to us mere mortals:

After last week’s dismal performance, the U.S. Dollar may be ready to continue its downtrend against most of the other major currencies, and even some of the minors, with the possible exception of the Japanese Yen.

Nevertheless, some caution in shorting the US Dollar this week is advised, mainly because of the increasingly oversold condition of the U.S. currency against the other majors that may prompt a corrective pullback.


In addition to the technicals indicating a possible bounce for the Greenback, the U.S. economy seems to be showing some fundamental improvement in key sectors such as manufacturing and employment.


The gains in these fundamental indicators may signal a favorable turn in the U.S. economic picture which will likely be reflected in gains for the U.S. currency against other major currencies over time.


Going forward, the market will now be watching Wednesday’s U.S. Trade Balance and the upcoming G-20 meetings in Seoul, South Korea just before next weekend to get a better sense of the direction of the U.S. Dollar.

On Thursday, after the US Federal Reserve announced buyback of treasury bills worth 800 billion dollars as an incentive for the country's slow economic growth, market prices of gold futures started growing. A weaker dollar inevitably triggers an appreciation of gold, traditionally viewed as an alternative and more reliable asset, and, at the same time, reduces dollar-denominated commodity prices as compared to other currencies.



For example, in response to the weakened dollar December gold futures on New York Mercantile Exchange sky-rocketed by 3.4% (to $1,383.10 per Troy ounce).






According to analysts, the gold market currently demonstrates an uptrend
 
On Thursday, after the US Federal Reserve announced buyback of treasury bills worth 800 bn. dollars as an incentive for the country's slow economic growth, market prices of gold futures started growing. A weaker dollar inevitably triggers an appreciation of gold, traditionally viewed as an alternative and more reliable asset, and, at the same time, reduces dollar-denominated commodity prices as compared to other currencies.



For example, in response to the weakened dollar December gold futures on New York Mercantile Exchange sky-rocketed by 3.4% (to $1,383.10 per Troy ounce).




On Thursday, after the US Federal Reserve announced buyback of treasury bills worth 800 bn. dollars as an incentive for the country's slow economic growth, market prices of gold futures started growing. A weaker dollar inevitably triggers an appreciation of gold, traditionally viewed as an alternative and more reliable asset, and, at the same time, reduces dollar-denominated commodity prices as compared to other currencies.



For example, in response to the weakened dollar December gold futures on New York Mercantile Exchange sky-rocketed by 3.4% (to $1,383.10 per Troy ounce).

and look what gold did:

 

According to analysts, the gold market currently demonstrates an uptrend with  Gold Prices Breaking New Highs After FED Announcement

 

Interesting!

 

SA EXCHANGE CONTROL RELAXES - EIIISH about time.

At the end of October, Foreign Investors were given a super boost from Pravin Gordhan the Minister of Finance in South Africa.


His statement and announcement that exchange controls on individuals, companies and pension funds would be eased dramatically with immediate effect, has been welcomed in the International and local markets.  Also, with the fact that the rand has gained nearly 30 percent against the dollar since the start of 2009 as low rates in developed countries push investors towards emerging market assets offering higher returns. Well, ...
 When he presented his medium-term budget policy statement in parliament, Pravin Gordhan said exchange controls on individuals, companies and pension funds would be eased dramatically.  and that by using their foreign investment allowance South Africans will now be able to move R4, 000,000.00 out of the country every year whereas before that was only once before.  A great leap. If you wanted to move more you could apply for this as well....so we certainly see big changes.
"That's the money that's coming to Brazil and South Africa. That's the money that's coming in on a short-term basis and can pull out any time," Gordhan said this mornining..




What else was offered, well there has been an increase of both the individuals annual travel allowance and the annual discretionary allowance, from R750, 000 to R1, 000,000.00.

The scrapping of the 10% exit levy on all blocked assets for those who have already emigrated, is a very welcome sign for the future.


"Well with the strong rand, we will certainly see a call for more fund movement out of SA especially from people who have assets such as properties that are either mortgaged or have equity in them and they want to raise home loans or further loans on those mortgages.  A great time to maximise the benefits of the strong rand", says Chris Green a Financial specialist in SA>.With interest rates at 9.5% and the lowest in the last 30 years, it is time that South Africans abroad and foreigners who own  property in SA, jump on the band wagon.  Call your mortgage broker today.

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