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Export-oriented knitwear manufacturers have alleged that an informal cartel of local spinners keeps yarn prices exorbitantly high despite a significant fall in global cotton prices in recent weeks.
   Spinners raised yarn prices when global cotton prices jumped two months back, but seemed reluctant to respond to the steep fall in cotton prices seen for a month or so in international market, dressmakers said.
   ‘Price of the widely used single carded yarns of 30 counts was raised within a few days to $2.95 from $2.45-2.50 per kg,’ said Sheikh Manawar Hossain, chairman of Active Knit Composite Limited.
   Industry people said raw cotton price soared to $90 per pound in March on speculations of output shortage from around $70 of weeks before.
   But cotton price fell
   to $75 per pound and maintained that level for more than a month, but the decline has not yet been reflected in local yarn prices.
   Knitwear manufacturers alleged that local spinners formed a cartel and were manipulating yarn prices to make a windfall profit at the cost of the whole industry.
   ‘Cartel of profit-monger spinners is behind the unusually high yarn prices in local market,’ alleged the owner of a knitwear unit at Fatullah industrial zone near Dhaka.
   Bangladesh Knitwear Manufacturers and Exporters Association president Fazlul Hoque said as low-cost basic knitwear makers spent more than 50 per cent of their production cost on yarns, increased price of the main raw material affected local manufacturers heavily.
   ‘It came as a fresh blow to the industry at a time when global buyers are continuously refusing to raise import prices of finished garments,’ he said.
   Hoque alleged that spinners were making undue profit, depriving their customers of the benefits expected from the declining cotton prices.
   ‘Taking the prevailing cotton prices into consideration, price of a kilogram of single carded yarns of 30 counts should be much bellow $2.70,’ he argued.
   Knitwear industry that earned nearly $4 billion in exports in nine months to March of the current fiscal has long been raising concerns about high prices of local yarns.
   Jahangir Alamin, vice-president of the Bangladesh Textile Mills Association, denied existence of any cartel to keep yarn prices artificially high.
   ‘It is not possible as more than 200 export-oriented spinners are supplying their products to the market,’ he argued.
   Alamin said for adjusting to rises in workers’ wages and other overhead costs, spinners would have to maintain existing price level. ‘Moreover, global cotton prices have not been stable yet,’ he claimed.
   Local spinners supply more than 80 per cent of yarn requirements of export-oriented knitwear units and their market is protected by European Union rules that make preferential market access conditional on use of locally produced yarns or fabrics.

Bangladesh Bank has warned the commercial banks of stern action if they fail to reduce lending rates by June to narrow the deposit and loan interest rate gaps to 5 per cent level as agreed.
   ‘If they do not reduce lending rates, the central bank will use its weapons such as not to issue any bank branch or authorised dealer licence,’ deputy governor Nazrul Huda said on Tuesday.
   Banks will also have to reduce various service charges at the same time, he said.
   The central bank was not putting any pressure on the banks to reduce lending rates, rather it is a ‘moral obligation’ of the banks to do it as recommended by the high-profile Bangladesh Better Business Forum, the deputy governor said at a press briefing.
   The forum on April 23 at a meeting presided over by chief adviser Fakhruddin Ahmed adopted 114 proposals for improving the country’s business environment.
   The meeting instructed the central bank to implement immediately five proposals regarding small and medium enterprises and women entrepreneurs and implement within one or two months 12 proposals regarding interest rate, service charge and monetary policy.
   Twenty-nine private banks in March agreed to reduce their industrial lending rate to maximum 14.75 per cent and spread [gaps between lending and deposit rates] to 5 per cent. They also decided to introduce uniform ceiling for service and commission rates for all banks.
   The central bank has already implemented all the five proposals, informed the deputy governor.
   In the last one week, four central bank circulars were issued asking the banks to help SMEs and women entrepreneurs.

The International Monetary Fund’s chief economist, Simon Johnson, announced Monday he is resigning, a year after taking the post, to return to research and teaching.
   Johnson notified IMF managing director Dominique Strauss-Kahn of his intention to return to his professor’s post at the Massachusetts Institute of Technology, where he is on leave of absence, the IMF said in a statement.
   He has been the IMF’s economic counsellor since March 2007 and will maintain his responsibilities until September 1.
   ‘In order to devote more time to research and teaching, I have decided to leave the IMF,’ Johnson said.
   ‘This is not an easy decision and I am sorry to leave the Fund. My many outstanding colleagues here have made it a pleasure and a great learning experience to come to work every day. I wish them all well in the days ahead.’
   Johnson thanked the IMF executive board for their ‘strong support’ of both independent-minded research at the 185-nation institution and his specific role as economic counselor ‘during challenging times for the global economy.’
   His resignation came less than a week after the IMF announced that one in five employees, or 50 per cent more than wanted, had applied for a buyout package.
   A total of 591 employees in the workforce of 2,900 sought the door under a separation programme launched in early March to trim salary costs at the financially troubled institution.
   Among those asking to leave were several department heads, including David Burton, one of the architects of the IMF reform under way to restore the relevance and credibility of the 44-year-old institution.
   The IMF said it will conduct an external search for Johnson’s successor.

The Asian Development Bank wound up its annual meeting Tuesday amid fears over soaring food prices and a debate over its role and relevance in Asia’s rapidly changing economic landscape.
   ‘Food pricing and security ... has the potential to undo many of the gains in reducing poverty and improving economic growth and prosperity that we have seen in Asia in recent years,’ Shahid Malik, Britain’s representative to the ADB board of governors meeting in Madrid, said Tuesday.
   Bank officials have told the two-day meeting that the soaring food prices could affect a billion people in Asia, home to two-thirds of the world’s poor.
   Prices for the benchmark Thai variety of rice, a food stable across much of Asia, are at about 1,000 dollars a tonne, up threefold from the last ADB annual meeting held in Japan one year ago.
   ADB president Haruhiko Kuroda blamed the crisis on reduced supplies and increased demand, along with the sharp depreciation of the US dollar and trade restrictions by some countries.
   He promised ‘immediate financial assistance to relieve fiscal pressure on affected countries.’
   On the eve of the conference, donors pledged 11.3 billion dollars by 2012 to help the bank tackle poverty and the food crisis, a 60 per cent increase over the previous four-year period.
   The food crisis has largely overshadowed other issues at the meeting, such as its ‘Strategy 2020’ long-term plan.
   The plan envisages a region ‘free of poverty’ through ‘inclusive growth, environmentally sustainable growth and regional integration,’ said Kuroda.
   ‘We at the ADB have set the stage for powerful change in the way we serve our developing member countries,’ he said.
   ADB’s adaption to change in Asia, which has been economically transformed since the bank was founded 42 years ago to help developing countries fight poverty, has been the subject of internal debate.
   ‘It’s important for it to realise that it’s an institution that needs to be almost continuously evolving,’ said US assistant secretary for International Affairs Clay Lowery.
   ‘If it fails to evolve it’s going to become irrelevant,’ said Lowery, the head of US delegation.
   The United States is the second-biggest donor to the ADB after Japan, and the two countries are jointly the largest shareholders.

Stocks on Tuesday gained slightly with regaining by majority number of securities after their fall in the previous day, said market operators.
   Dhaka Stock Exchange general index gained 8.80 points or 0.29 per cent to close at 3096.24 while its blue chips index, DSE20, advanced by 7.01 points or 0.30 per cent to finish at 2373.80.
   A DSE stock broker said the market remained almost flat despite the recovery made by majority issues.
   Of the total 245 issues traded at the DSE, 149 gained, 87 declined and nine remained unchanged while out of 143 issues traded at the Chittagong Stock Exchange, 83 posted gains, 55 dropped and five remained unchanged.
   The CSE selective categories index gained 4.15 points or 0.07 per cent to close at 5594.14 while its blue chips index, CSE30, advanced by 1.75 points or 0.02 per cent to finish at 7572.43.
   Turnover at the DSE decreased to Tk 273.93 crore from the Monday’s Tk 284.72 crore and at the CSE went down to Tk 35.91 crore from Tk 39.42 crore.
   AB Bank topped the turnover leaders at the DSE with total transaction of Tk 21.30 crore.
   Meanwhile, the Securities and Exchange Commission has issued show-cause cum hearing notices to directors, managing directors and company secretaries of the Chic Tex, M Hossain Garments Washing and Dyeing, Metalex Corporation, Raspit (Inc) Bangladesh, CMC-Kamal Textile Mills, Bengal Fine Ceramics, German Bangla JV Food, Maq Enterprises and Mita Textiles for non-holding of their annual general meeting for the year of 2007, DSE official website reported on Tuesday.

Authorities in Guangdong province in China are looking to provide 1.2 million jobs this year and give equal treatment to migrant workers in areas like social insurance.
   The provincial government said in an annual labour and security development action plan, which was unveiled recently, that half of the jobs will be newly created, 28 per cent higher than the previous year.
   It also aims to help 600,000 unemployed people find jobs.
   The province will also offer training programmes to 40,000 people on how to start new businesses.
   Some 20,000 others will receive technical training. The number of full-time students in technical schools will hit 480,000 this year—the province’s backbone for further industrial development.

President Susilo Bambang Yudhoyono said Tuesday that Indonesia was considering quitting the Organisation of Petroleum Exporting Countries because it was no longer a net oil exporter.
   ‘Our wells are drying,’ he said in the nationally televised speech, adding that the country needed to concentrate on increasing domestic production, which has dropped to less than a million barrels a day even as consumption rises.
   The government opened talks Monday on whether it ‘should continue to stay with OPEC or withdraw our membership ... until we reach a point where we deserve to rejoin that organisation,’ Yudhoyono told governors and heads of regencies from all over Indonesia.
   The country of 235 million people is Southeast Asia’s only OPEC member. But it has to import oil because of decades of declining investment in exploration and extraction due to corruption and a weak legal system that makes oil companies wary of doing business here.
   Indonesia’s oil output has declined steadily from oil production of 1.5 million to 1.6 million barrels a day in the mid-1990s. It produced around 860,000 barrels a day of crude oil last month and recorded a deficit of $794 million in its oil trade accounts.
   Raising output could take ‘one to three years,’ Yudhoyono said.
   It is not the first time the country has re-evaluated its OPEC membership, but in past years teams commissioned by the government have recommended staying in the grouping to maintain good relations with other oil producers, especially the heavyweights in the Middle East.
   OPEC is an intergovernmental organisation made up of 13 oil-producing countries. It was first formed in 1960 by founding members Iran, Iraq, Kuwait, Saudi Arabia and Venezuela.
   Indonesia, which joined OPEC in 1962, would not pull out until next year if the move was approved, because it has already paid dues thru 2008, according to minister of energy and mineral resources Purnomo Yusgiantoro.

The Islami Bank Bangladesh Limited has disbursed Tk 1531.47 crore under Rural Development Scheme as on March 3l, with growth rate of 47.72 per cent against the same period of the previous year, said a press release.
   The recovery of investment is 99 per cent. This programme was implemented in 10237 villages of 61 districts through 129 branches of the bank which has 50.38 million beneficiaries.
   The IBBL launched its RDS programme in 1995 aiming at rural development and establishing model villages across the whole country by changing the destiny of poor rural people, unemployed rural youths, self-employment of down-trodden people, poor farmers and share-croppers.
   The Islami Bank Foundation has taken various supportive programme serving education, medicare and health services to the nation under the village of RDS.

The United States, the Asian Development Bank’s second-biggest donor, warned the institution on Tuesday it risked becoming irrelevant if it fails to adapt to the region’s rapid economic expansion.
   ‘It’s important for the ADB to stick to its overall mission, but at the same time it’s important for it to realise that it’s an institution that needs to be almost continuously evolving,’ said US assistant secretary for International Affairs Clay Lowery.
   ‘If it fails to evolve it’s going to become irrelevant,’ said Lowery, who is heading the US delegation at the bank’s board of governors meeting in Madrid.
   ‘Our view is that the ADB is doing a pretty good job and it can do an even better job going forward, but it is going to have to evolve with the times,’ he told a news conference.
   The United States is the second-biggest donor to the ADB after Japan, and the two countries are jointly the largest shareholders.
   In a statement to the board of governors meeting on Monday, Lowery called on the ADB to make ‘institutional reforms,’ including steps to end what the US sees as a bias toward nationality over merit in its hiring practices.
   He also urged it to ‘adapt to changes’ in middle-income countries, referring to India and China.
   ‘As time progesses and China becomes even wealthier, I think the ADB needs to figure out how it changes its products, how does it work in a different way with China,’ Lowery said Tuesday.
   The ADB is facing an internal row over its role and relevance in a region that has been transformed since the bank was founded 42 years ago to help developing Asian economies fight absolute poverty.
   Washington also opposed the ADB’s ‘Strategy 2020’ long-term plan, which was approved by the bank’s board this month.
   ‘We worked with the management and other shareholders to try to get a strategy document that we were comfortable with, but we just never got there and so we voted our conscience,’ said Lowery.
   ‘This is a financial institution, and financial institutions can put together strategic documents, but we usually want to see what are the resources that you are allocating against that strategy, what are the different types of scenarios that you are looking at in terms of lending volumes, in terms of operational products and how do they evolve over time.’
   ‘In this case the management did not really do that,’ he said.
   ADB president Haruhiko Kuroda said on Monday the ‘Strategy 2020’ envisages a region ‘free of poverty’ through ‘inclusive growth, environmentally sustainable growth and regional integration.’
   ‘We at the ADB have set the stage for powerful change in the way we serve our developing member countries,’ he said in an inaugural speech to the board of governors.
   The bank’s long-term strategy has been largely overshadowed at the meeting by concerns over soaring food prices in the region.
   Based in Manila, the ADB is owned by its 67 member countries — 48 from the Asia-Pacific region, and 19 from elsewhere around the world.

Federal Reserve chairman Ben Bernanke on Monday said conditions in mortgage markets remain strained, posing a threat to the economy, and urged steps be taken to prevent home foreclosure where possible.
   ‘High rates of delinquency and foreclosure can have substantial spillover effects on the housing market, the financial markets, and the broader economy,’ Bernanke said in remarks prepared for delivery to the Columbia University School of Business in New York.
   Bernanke said the sharp US housing downturn is producing a steep rise in mortgage delinquencies. Not all foreclosures result in the loss of the home, he said, but the high number of borrowers in distress and sharp declines in home values in regions of the country mean the share of people who lose their homes will be higher in the current situation than in the past.
   A widespread decline in home prices is a relatively novel phenomenon, and lenders and loan servicers will have to develop new and flexible strategies to deal with this issue, the Fed chairman said.
   Bernanke called on Congress to move quickly on legislation expanding the Federal Housing Administration and strengthening oversight of government-sponsored mortgage finance enterprises Fannie Mae and Freddie Mac.
   ‘Finding ways to avoid preventable foreclosures is a legitimate and important concern of public policy,’ he said.
   Bernanke’s comments come as a sharp spike in problem U.S. home loans and a deep correction in U.S. housing markets have led to financial market turmoil and weighed on US economic growth to the point that many analysts believe it is in recession.
   A congressional panel last week passed a sweeping bill to enable the government to finance $300 billion in distressed mortgages. Its authors say the measure would help 2 million homeowners avoid foreclosure.
   The Bush administration opposes the measure, saying it exposes taxpayers to potentially significant losses if a large share of loans refinanced by the government fail.

Close on the heels of president George W Bush’s remarks linking Indians’ food habits to rising global prices of commodities, the United States has now partly attributed the surge in oil futures to the increased demand in India and China.
   ‘There are a lot of different ways that we can reduce our dependence, but we have more to do and it’s just — and also I would point out that, obviously, the demand for oil is growing around the world,’ White House Deputy Spokesman Scott Stanzel said in a briefing.
   ‘Many developing nations like India or China are having greatly increased demand, which obviously is having an impact on price,’ the senior White House official said responding to a question on the crude oil price crossing $120-mark.
   The senior White House official stressed that it was important for the United States to become less dependent on foreign sources of energy.
   Highlighting the need for ‘domestic exploration’, he said ‘We also have to do more in terms of building refineries. We haven’t built refineries in about 30 years’.
   Stanzel also spoke regarding Bush’s remarks, which have drawn a lot of flak from every section in India, saying the United States saw ‘higher living standards’ of people there as a ‘good thing’.
   ‘We think that it is a good thing that countries are developing; that more and more people have higher and higher standards of living,’ he said.
   However, he apparently did not go back on Bush’s point that Indian food habits were contributing to spiralling prices of commodities, which in turn, were worsening the global food crisis.

China should be aware of the difficulties new visa restrictions could cause for businesses ahead of the Olympics, Australia’s foreign minister said on Tuesday.
   ‘It is important that the Chinese authorities understand the potential practical, on-the-ground difficulties that this is causing,’ Stephen Smith told reporters in Hong Kong.
   Australia is seeking clarification from Chinese authorities in Beijing and Hong Kong about the new restrictions, which travel agents across Asia have said has seen China stop issuing multiple-entry visas.
   China has insisted multiple-entry visas are available but said in a statement that officials would ‘consider the real need of the applicant’ when granting one.
   Business travellers and tourists must also provide hotel receipts and travel tickets before any visa will be issued, travel agents have said.
   Smith said he understood why China was making the apparent changes, but it must be aware of the pitfalls.
   ‘Australia has had recently an Olympics as well with the Sydney Olympics, so we understand the general public policy motivation,’ he said.
   ‘We do want to make sure that there are no long-term adverse repercussions for trade and business and industry exchange between Hong Kong and China, and between other nation states and China,’ he added.
   China stopped issuing multiple-entry visas around the start of April and will not resume issuing them until October, after the August Olympics, travel agents in several Asian countries have said.
   Visitors from 33 countries — including India, the Philippines and Indonesia — are also no longer allowed to apply for China visas in Hong Kong and have to apply at their local Chinese embassies, two Hong Kong agents previously told AFP.

Cash-flush China may be winning allies and displacing American influence by ramping up foreign investments and disbursing aid with no strings attached, but a US congressional study says Washington need not lose sleep over it.
   Beijing’s rising investments on the back of its huge pool of US dollar reserves is not necessarily always popular at home or abroad and accounts for less than one per cent of foreign direct investment worldwide, said the Congressional Research Service study.
   Furthermore, China’s ‘soft power’ achievements using tools such as trade and investment, development and humanitarian aid, cultural influence and travel and tourism are built on a ‘very narrow base,’ it said.
   And even in those areas, including disaster relief, China’s effort and accomplishments ‘pale beside those of the United States,’ said the report.
   The study, undertaken by a group of China specialists and regional analysts, examined the strengths and weaknesses of China’s foreign policy and growing use ‘soft power’ in Asia, Africa, and Latin America.
   ‘Contrary to some projections of China’s ability to displace American influence through the use of soft power, the CRS report indicates that China must grapple with many limitations on its influence,’ said Senate foreign affairs panel chief Joseph Biden, who commissioned the study.
   While China uses soft power to increase its economic and political leverage globally amid US preoccupation in Iraq and a weakening US economy, Beijing’s success ‘has been mixed and its influence remains modest,’ he said.
   China is attempting to exploit areas in which it holds a comparative advantage to increase its influence, sometimes in a way that runs counter to US interests, the study said.
   For example, it said China’s willingness to provide no-strings-attached foreign aid ‘often undermines international efforts to combat corruption, improve transparency, and foster respect for human rights.’
   On the plus side, however, China’s involvement in Africa, for example, was spurring investment in infrastructure, the financial services and manufacturing as well as market niches that non-Chinese foreign investors had generally long ignored.
   China also provides the developing world access to cheap credit and inexpensive consumer goods, and many countries are enjoying rapidly rising revenues due to Chinese demand for their exports, the report said.
   On the other hand, it said, China’s manufacturing strength made it difficult for industries in the developing world to gain a competitive advantage, putting some out of business.
   And China’s investment in developing economies, particularly in natural resource extraction, ‘sometimes undermines international efforts to link aid and investment to measurable progress by recipient countries in combating corruption, improving transparency, and respecting human rights.’
   Beijing’s foreign entanglements sometimes backfired — the report discovered cases where Chinese economic engagement became the subject of intense, xenophobic political debate.
   The study showed that China’s foreign direct investment worldwide amounted to 73.3 billion dollars at the end of 2006 — a paltry 0.58 per cent of such global investment.

Syed Imtiaz Faruque took charge of head of human resources in British American Tobacco Bangladesh from May 1.
   Imtiaz, an economics graduate from Shahjalal University of Science and Technology, started his career at BAT Bangladesh as a management trainee in 1998, said a press release.
   Imtiaz moved to BAT Korea as organisational development manager in 2005. He also served BAT Cambodia as head of HR.

A total of four Berger colour bank outlets were inaugurated recently in Khulna.
   Rupali Chowdhury, managing director of Berger Paints (BD) Ltd, inaugurated New Kakoli Hardware at Magura, and Sayeed Hardware at Veramara, Kushtia, on April 28, said a press release.
   On April 29, she also inaugurated Padma Hardware at Shantidham More, Khulna and Builders Biponi at Hatkhola, Jessore.
   Mohsin Habib Chowdhury, general manager, sales and marketing, and Ata-I-Muneer, branch manager of Khulna, were also present on the occasions.
   The new colour bank outlets have been inaugurated in keeping with the increasing demand of colour bank shades from Berger.

The Local Enterprise Investment Centre has recently signed a contribution agreement with the North Bengal Cycle Industries Ltd.
   Under the agreement, the LEIC will assist NBCIL to conduct a six month training course for sustaining its outsourcing partnership with TATA International Limited, and export black bicycles to Africa.
   Anis A Khan, chief executive officer and managing director of IDLC Finance Limited, and Fazle R M Hasan, chief executive, North Bengal Cycle Industries Limited, signed the agreement, said a press release.
   LEIC, a private sector development project funded by the Canadian International Development Agency and managed by IDLC Finance Limited, is working with a special focus to facilitate inter-company long-term alliances.

World oil reached a new record price near 121 dollars a barrel on Tuesday as concerns over the United States economy eased, analysts said.
   New York’s main oil futures contract, light sweet crude for June delivery, reached an all-time high of 120.93 dollars a barrel during Asian hours before dropping back in late afternoon trade when it was three cents lower at 119.94 dollars a barrel.
   The contract crashed through the symbolic 120-dollar ceiling for the first time on Monday and closed at a record 119.97 dollars on the New York Mercantile Exchange.
   Brent North Sea crude for June delivery was 24 cents higher at 118.23 dollars a barrel, after settling at a record 117.99 dollars on Monday in London. The contract had earlier hit an intra-day high of 118.58 dollars.
   Oil futures prices on both sides of the Atlantic have nearly doubled in a year and have continued to soar since the benchmark New York contract broke through 100 dollars at the start of 2008.
   Latest US economic data have given oil prices a fresh boost, said Victor Shum, senior principal at Purvin and Gertz energy consultancy in Singapore.
   On Monday, the Institute of Supply Management said its index for the vast US service sector rose to 52 per cent in April, above the level of 50 that means expansion, and better than expected by private analysts.
   That report followed official data on Friday which showed that the US economy shed 20,000 jobs in April, far fewer than the 75,000 expected by the market.
   The unemployment rate unexpectedly slipped a tenth of a per centage point to 5.0 per cent, the US Labor Department said, compared with an expected rise to 5.2 per cent.
   Shum said the jobs report gave momentum to the market and the numbers from the services sector ‘further added to the thinking that the slowdown in the US economy may not be as bad as initially thought.’
   Traders had feared that a severe slowdown in the United States, the world’s biggest economy and largest energy consumer, could affect oil demand.
   ‘The sentiment is quite bullish as a lot of investors think that either way you can’t go wrong with oil,’ Shum said.
   Dave Ernsberger, Asia director of global energy information provider Platts in Singapore, said that ‘most importantly now there is evidence that the US economy is doing quite well.’
   Supply jitters from Nigeria and geopolitical tension over Iran added to the price surge on Monday, analysts said.
   Nigerian militants attacked an oil ship off the coast of the west African country and took two people hostage, a military spokesman said Sunday. Shell accounts for about one-half of Nigeria’s 2.1 million barrels-per-day output.
   ‘Nigeria is the lingering hotspot the markets will be focusing on,’ said MF Global analyst Ed Meir.
   Iran said Monday it would reject any offer that violates its right to the full nuclear fuel cycle after world powers said they had prepared a new package to end a long-running standoff over its nuclear programme.
   Oil players fear the ongoing tension could result in Iran using oil as a bargaining chip. Iran is the second-largest producer in the Organisation of the Petroleum Exporting Countries cartel.
   US President George W. Bush will make US concerns about soaring oil prices ‘very clear’ when he visits Saudi Arabia next week, White House spokesman Scott Stanzel said Monday.
   Saudi Arabia is OPEC’s biggest crude producer.

The dollar eased against major currencies in thin trading Tuesday ahead of interest rate decisions this week in the eurozone and Britain, dealers said.
   In early European trade, the euro firmed to 1.5493 dollars from 1.5492 in New York late on Monday.
   Elsewhere on Tuesday, the dollar slid to 104.72 yen from 104.86. Trading was subdued with Japanese financial markets closed for a public holiday, and London participants returning to work after a national holiday in Britain on Monday.
   Dealers turned their focus towards Thursday’s monetary policy decisions from the European Central Bank and Bank of England.
   ‘There is a fairly quiet calendar on Tuesday ahead of the BoE and ECB decisions on Thursday,’ said ABN Amro analyst Melinda Smith.
   The ECB and BoE were widely forecast to leave their key interest rates unchanged at 4.00 and 5.00 per cent respectively, according to analysts.
   The US Federal Reserve had last week cut American borrowing costs by a quarter-point to 2.00 per cent.
   Higher interest rates are usually seen as positive for a currency because investors prefer assets which offer higher yields.
   The US currency, which hit a record low of 1.6019 to the euro on April 22, recovered some ground last week before turning lower again.
   ‘The dollar recovery has lost some momentum over the last few days despite the stronger than expected US employment and ISM non-manufacturing reports,’ said economist Lee Hardman at The Bank of Tokyo-Mitsubishi UFJ in London.
   The US factory sector shrank in February for the second time in three months, a survey showed on Monday, highlighting fears about a softening economy.
   The Institute of Supply Management said its survey of manufacturing activity fell to 48.3 per cent from 50.7 per cent in January. A number below 50 per cent signals declining activity.
   James Hughes, market analyst at CMC Markets, said that the foreign exchange market was preoccupied with fears of a potential recession in the United States.
   ‘Yesterday’s surprise jump in US ISM data failed to offer any real support for the dollar, arguably as the threat of recession continues to be associated with the US economy by a number of commentators,’ Hughes said.
   Elsewhere, Australia’s central bank left interest rates unchanged at a 12-year high of 7.25 per cent.
   The widely-expected move came as the Reserve Bank of Australia said previous rate hikes in February and March, along with market turmoil stemming from a global credit crunch, had eased demand in the economy.
   In London on Tuesday, the euro changed hands at 1.5493 dollars against 1.5492 late on Monday, at 162.27 yen, 0.7879 pounds and 1.6277 Swiss francs.

First Solution starts sending remittance
The UK-based First Solution Money Transfer Limited has started sending remittance to Bangladesh through Southeast Bank. Bangladesh Bank gave approval to Southeast Bank to start regular business with the UK-based company in April, said an official of the private sector bank. The First Solution paid 340,000 pound sterling to the remitters in England and Tk 80 lakh to local beneficiaries to settle the earlier unpaid transactions, he informed. The company in the past one month sent over $1.8 lakh to the bank for settlement of over 130 transactions, and out of which about 20 are new transactions, he said. The bank and the exchange house signed a conditional drawing arrangement and First Solution transferred Tk 5 lakh and $25,000 as security deposit in March. The Bangladeshi-owned exchange house had collected about 1.7 million pound sterling from Bangladeshis living in the United Kingdom, but did not make the money available to local beneficiaries last year. The company was liquidated after transaction frauds surfaced and put under a new management though it retained the previous name. Chairman of the money transfer company MA Mannan and a couple of other directors recently met with officials of the central bank to look for ways to resume operation in Bangladesh. In the official website of First Solution, it was written, ‘Customer who lost their money should get most – if not all - of their cash back, following a rescue deal.’
— New Age

Hong Kong gold closes higher
Hong Kong gold prices closed higher on Tuesday at 878.50-879.50 US dollars an ounce, up from Monday’s close of 864.00-865.00 dollars. It opened at 873.00-874.00 dollars.
— New Age