Money Market
Overnight money market was flat this week. The call money rate was range bound and most of the deals ranged between 6.50 and 6.60 percent throughout the week.

International FX Market
The yen rebounded against major currencies at the beginning of the week on Monday following comments from the Bank for International Settlements over the weekend on the yen's recent weakness and as traders sought to reduce risk exposures. The ultra-low yielding yen last week sank to multi-year lows against a range of higher-yielding currencies-including a record low against the euro but dealers on Monday decided to take profits on these over-extended positions.

The yen rose broadly during the middle of the week and high yielders dipped as worries about the US sub-prime mortgage sector dimmed appetite for the carry trade. Falling stock markets, due partly to concerns about the exposure of US lenders sub prime mortgages, have reduced investor interest in risk assets around the world. Analysts said the yen's strength was bolstered by changes in the Japanese government, with Naoyuki Shinohara set to replace Hiroshi Watanabe as vice minister for international affairs. Watanabe had been seen as more opposed currency intervention than his predecessors.

The yen's three-day rally fizzled out on Thursday as a rebound in stocks eased concerns about the US high-risk mortgage market, prompting investors to borrow the Japanese currency again to fund carry trades. The dollar steadied versus the euro, with markets awaiting the outcome of a two-day Federal Reserve meeting later in the session. The bank is seen holding rates at 5.25 percent and its statement will be scrutinized for clues on future policy. Softer US data this week had shifted investor sentiment back towards the next Fed move being a cut rather than a hike, although most see rates on hold for the rest of the year. The Nikkei share average closed 0.46 percent higher on Thursday and European shares jumped 0.8 percent in early trade after gains on Wall Street overnight, showing investor risk appetite is reviving. The Australian and New Zealand dollars jumped against the yen as people resumed carry trades, in which low-yielding currencies are borrowed to fund higher-return investments.

- Standard Chartered Bank