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Wednesday April 30, 2008

Singapore SIBOR rate fell to 1.25% in Apr 2008, lowest since Aug 2004

The Singapore SIBOR rate fell to 1.25% in mid April 2008, a near 4-year low, according to data from the MAS domestic interest rates website.

Homeowners who are looking to refinance to SIBOR-linked home loans should be able to obtain relatively low interest rates. These are good deals in a falling interest-rate environment, but conversely, if interest rates rise, so will the mortgage payments on these loans.

According to an earlier Straits Times article :

DBS charges a premium of an annual 1 per cent over the Sibor rate, while UOB and OCBC Bank add an annual 1 per cent over the three-month, six-month or nine-month Swap Offer Rates (SOR). The SOR comprise the Sibor plus a bank's lending costs.

Hence, from the above, SOR or Swap Offer Rate home loans which seem to be getting quite popular with Singaporean homeowners recently are actually SIBOR-linked loans as well. The premium over the SIBOR rate will incorporate the bank's margin and like most private home loans, the actual interest rate is subject to case-by-case negotiation between the buyer and seller.

(2008-04-30 13:29:14 SGT) [Biz] Permalink Comments [1]

Tuesday April 29, 2008

OPEC chief warns of $200 a barrel oil price as NYMEX crude oil hits $119.93 record

This article belongs to the NYMEX crude oil price records story arc.

peakoil.com -> business.timesonline.co.uk :

The president of OPEC, the cartel of oil-producing countries, has given warning that the price of crude could hit $200 a barrel, sparking fears that rising fuel costs will force more businesses into bankruptcy. Chakib Khelil, the Algerian Energy Minister and president of Opec, said that the falling value of the US dollar would continue to drive up oil prices as investors sought to store their wealth in other assets. The price of oil hit an all-time high of nearly $120 a barrel today [28 Apr 2008] after North Sea production was shut down yesterday because of a strike at the Grangemouth refinery in Scotland. In early trading the price of US light crude rose $1 to $119.93 amid concern about the impact of industrial action at Grangemouth.

- Now even OPEC is talking about $200 oil. However, and I have come to expect nothing less, the contrarian community is already way ahead, and the contrarians are already talking about $300 oil, $400 oil and beyond. The $200 target was last year's talk.

So, whatever happened to "demand destruction" because of the US recession? Nowhere to be seen. In fact, I just heard on Jim Puplava's Financial Sense Newshour that for every 1 barrel of reduced American demand, there are 14 barrels of increased demand from developing countries such as China, India, Brazil and so on.

The news media likes to speculate over exactly how many dollars ($20? $30? $50?) of the crude oil price are due to mysterious oil traders, speculators, "hot money" from investment funds, and such. This is just another form of denial. In a similar fashion, the same media had been crowing about how crude oil was "still below" the Apr 1980 inflation-adjusted figure of $103.76 per barrel and had to stop writing this phrase in once oil hit $103.95 and quickly went beyond. Perhaps it just might take $200 oil to convince people that it isn't really "hot money" at all, but Basic Economics 101, that this is what happens when demand is greater than supply.

(2008-04-29 19:36:33 SGT) [Energy] Permalink

Monday April 28, 2008

Singapore CPI inflation rate hits 6.7% for Mar 2008, fastest in 26 years

This article belongs to the Singapore inflation watch story arc.

Singapore's inflation accelerated in March [2008] to the fastest pace in 26 years, adding support to the central bank's decision this month to allow the currency to strengthen further. The consumer price index jumped 6.7% from a year earlier, after gaining 6.5% in February, the Department of Statistics said today [23 Apr 2008].

The Monetary Authority of Singapore in its twice-yearly review of the exchange rate on April 10 unexpectedly targeted a stronger trading range for the currency. The appreciation of the Singapore dollar, which has risen to an all-time high versus the U.S. currency, is helping reduce import costs as food and energy prices climb. Singapore's government is distributing cash and food vouchers to its citizens as part of fiscal measures to boost the economy and ease the burden of rising prices.

- I'm worried that, as far as inflation goes, "we ain't seen nothin' yet". Crude oil prices continue to test new record highs ($119.93 was hit this morning), and food prices continue to be driven upward by increasing agricultural commodity prices, particularly rice which has been setting new records.

I am skeptical about using Singapore dollar appreciation as a tool to combat inflation due to the limited range at which it can be allowed to appreciate without killing off our exporting companies, and the food vouchers part is also worrying because it has never been the custom for the Singapore government to move towards any form of welfare system. And the fact that they are doing so is really driving home the depth of the crisis that we are now facing.

Updated :

1. Singapore CPI inflation rate for May 2008 continues at 26-year high of 7.5%
2. Singapore inflation rate hits new 26-year high of 7.5% in Apr 2008

(2008-04-28 19:33:26 SGT) [Biz] Permalink

Singapore petrol prices up in long-overdue move

This article belongs to the Singapore inflation watch story arc.

asiaone.com, petrolwatch.com.sg :

The other oil companies have all followed Caltex's move to raise pump prices here. ExxonMobil, Singapore Petroleum Co and Shell on Wednesday [23 Apr 2008] upped petrol prices by three cents a litre and diesel by five cents. Their increases, within hours of each other, came a day after Caltex revised prices upwards. With the changes, a litre of 92, 95 and 98-octane petrol is $2.083, $2.116 and $2.190 before discount, while diesel is $1.663. Shell's V-Power is $2.309, while Caltex's Platinum is $2.316.

The latest pump price adjustment is the 10th consecutive increase since July last year [2007] - 11th if the GST-triggered increase on July 1, 2007 were to be included. Singapore's Goods & Services Tax [GST] was raised from 5 to 7 per cent last July. Some observers have questioned why pump prices here are not softening on the back of the strengthening Singapore dollar.

- Either these observers lack an understanding of the crude oil and currency exchange markets or they are just spouting nonsense. Maybe both. A look at the historical USD/SGD forex rate shows that the SGD has strengthened (relatively, I must always add) by around 11% (from 1.53 to 1.35) from Jan 2007 till now, but crude oil has strengthened even further, going up by a whopping 133% ($51 to $119 per barrel). And people are wondering why a strengthening currency isn't helping. This is because even though we Singapore folks may be in a currency that has "strengthened", the underlying commodity has "strengthened" further. I have been making this point again and yet again, but then of course very few people look at this the way a peakoiler would.

I would also say that this is a long-overdue move because the last time that the petrol prices went up was back in March when crude oil prices were hovering in the $100-110 range (and that was precisely what I was thinking when I filled up my tank on Monday, just a couple of days before the price increase). Now we're in the $110-120 range and it sure took them long enough to adjust their prices upward. Then again, I'm not looking at this from the point of view of most of the general public, who would probably want me to shut up already at this point. Shrug, I'm just calling it the way I'm seeing it. Me, I'm going out to buy more energy income trusts to continue to hedge my petrol bills, which would of course be going up like everyone else's.

Updated :

1. Singapore petrol prices lowered 4 cents after crude oil drop
2. Singapore petrol prices down another 4 cents on lower crude oil prices
3. Singapore petrol prices drop 4 cents for third time in 2 weeks

(2008-04-28 13:09:14 SGT) [Energy] Permalink

Sunday April 27, 2008

How to insert currency exchange rates into Google Spreadsheets

The financial formula lookups that Google Spreadsheets provides have proved very useful for managing the multiple portfolios that I have - besides running the family fund, I also manage my wife's account and I am also a fund manager for a private investment fund that specializes in commodities investments.

The only problem is that, although the Google finance lookup functions are able to provide many useful figures including stock prices, market capitalizations and so on, there is one critical component missing - the ability to do currency exchange rate conversions. I manage my accounts on a Singapore dollar (SGD) basis, while I invest in the US and Canada markets which are denominated in the US and Canadian dollars (USD, CAD) respectively. I found a couple of suggestions from online forums and actually used one of them for a while, which scraped the forex rates from a Google finance page, but then it stopped working recently. So I did some research on my own and came up with a better alternative that uses a Yahoo-based currency converter instead.

If you want to skip the explanation that follows, just insert the following formula, change CAD to the currency you want to convert from, and change SGD to the currency you want to convert to :

=Index(ImportHTML("http://finance.yahoo.com/q?s=CADSGD=X","table",1),8,2)

And there you are. Once you enter the formula, the exchange rate will be inserted into the cell, and it will be automatically updated whenever the forex markets are open (see screenshot above).

There is a disclaimer, however. This currency conversion formula is not real-time. There will be a delay of a few minutes (to monitor real-time rates, check out my livequotes page). Even so, this formula is already better than the Google Finance-based one I was using earlier - that one had a delay of 1-2 hours or more. To display the time of update, you can use this formula (as before, change the CAD and SGD symbols to whatever you wish to use) :

=Index(ImportHTML("http://finance.yahoo.com/q?s=CADSGD=X","table",1),2,2)

When the forex markets are open (which is most of the time, since forex exchanges are 24/5 markets, ie 24 hours a day, 5 working days a week), the time field should show something like "11:37AM ET", where ET is Eastern Time (i.e. New York's timezone). When the markets are closed, such as during weekends, this field should show the last trading day's date instead (such as the above, "4/25/2008").

Here's how it works : the ImportHTML function scrapes a web-page that you specify (in this case, the Yahoo Finance page for the specific currency pair). The "table" parameter tells the formula to use table-scanning mode, and the "1" refers to the index of the table to use, in case there are multiple tables on that page.

But if you use the ImportHTML function alone, you will get the entire table in an array (as in the bottom part of the screenshot above). So it's actually an array formula that returns the results in an array. The next thing to do is to isolate the cell that you want in that array. That's what the Index function does - the addressing is via row, then column, and the index starts from 1 and not 0, as C- or Java-based programmers might usually expect.

So, if you look at row 8, column 2 from the screenshot above, you will note that we are referring to the bid value for that currency pair. For most typical purposes, the bid value is what you will be using. And the time field (or last trading date when the markets are closed) is obtained from row 2, column 2.

This should be applicable until let's say a. Google decides to add a built-in real-time (or nearly so) currency conversion function, or b. Yahoo decides to change its currency conversion URL, URL format, or the format of the currency conversion page - even if Yahoo does so, with the explanation above, you should probably be able to amend the formula to get the figures back again.

Hope this is of help to you.

(2008-04-27 18:49:45 SGT) [Tech] Permalink

My first Google Adsense cheque

My first Google Adsense cheque has arrived in the mail. A grand total of SGD $156.34 based on accumulated earnings from end-Jan 2008 when I started monetizing my blog to the end of Mar 2008 when the payout was calculated. Based on USD $116.30 earnings at that point, the USD/SGD currency exchange rate used would work out to 1.34428. It's funny how I have been watching and blogging on the falling dollar, and how now my very first Google cheque has been hit by this. But of course I have been expecting this, and I also expect that the US dollar has further to fall.

Vagaries of the forex markets aside, I'd suppose $116.30 for 2 months isn't too bad, seeing how I initially set out to recoup my hosting costs of $12.85 per month. Or to look at it another way, the couple of dollars or so every day now helps to cover my tea-break expenses (a cup of tea or coffee and a bun at the local coffeeshop). My tea-break costs are hedged, as are my petrol bills with the monthly dividends of a couple hundred dollars or so coming in from my energy income trusts.

Talking about coffee, once the cheque clears, I will be owing shooperman a cup of coffee (as promised earlier) - he was the one who suggested to me to try to make some money from my blog. Though it's a modest start, I can say it has done far better than my initial expectations. Thank you, readers of lowem.log for your support.

(2008-04-27 16:55:39 SGT) [Musings] Permalink Comments [4]

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