Evening Report-sept 23.

The rupee weakened in early trade as higher oil prices and weak Asian stocks raised worries of more foreign fund outflows from the local share market. The dollar weakened against other currencies on speculation that the United States would have to increase its debt to finance its bailout plan. Turning to the US Richmond Fed manufacturing index for September and the house price report for July have been slated for release in the New York morning. A testimony by the Fed Chairman Ben Bernanke and U.S. Treasury Secretary Henry Paulson at the Senate Banking Committee which could spark volatility in the market as traders eagerly await for further clues to know how regulators will respond to the recent turmoil in the financial sector. EURUSD continues to be on bull note. The manufacturing PMI plunged to 45.3 from 47.6, while the services PMI slipped to 48.2 from 48.5. which strengthens the argument that Europe’s largest economy will fall into a recession. Stagnant growth among in the Euro-Zone suggests that economic activity may remain subdued as the global economy cools which could lead the ECB to lower the benchmark interest rate GBPUSD continues to be on bull note as Mortgage approvals in the U.K. slipped to a record low suggesting that the downturn in the housing sector . Declining home prices paired with tightening credit conditions has clearly taken a toll on the economy. Stagnant growth paired with high inflation has left the BoE in a complex situation and they may no longer be able to sit on the sidelines as the downturn in the economy accelerates. ahead of schedule Japanese yen showed strength against its major counterparts as a fall in stock prices prompted investors to reduce holdings of higher-yielding assets funded in Japan.