in short - term dollar assets, combining both public and private instruments, is huge relative to the size of asset holdings of asian monetary authorities. and because these issues are short - term and hence capable of only limited price change, realized capital losses, if any, would be small. accordingly, any incentive for monetary authorities to sell dollars, in order to preserve market value, would be muted. * * * a different issue arises with the apparent level of hedging by exporters in europe and elsewhere. the effect, however, is the same as asian official intervention : it slows the process of adjustment. against a broad basket of currencies of our trading partners, the foreign exchange value of the u. s. dollar has declined about 12 percent from its peak in early 2002. ordinarily, currency depreciation is accompanied by a rise in the dollar prices of our imported goods and services, because foreign exporters seek to avoid price declines in their own currencies, which would otherwise result from the fall in the foreign exchange value of the dollar. reflecting the swing from dollar appreciation to dollar depreciation, the dollar prices of goods and services imported into the united states have begun to rise after declining on balance for several years. but the turnaround to date has been moderate and far short of that implied by the exchange rate change. apparently, foreign exporters have been willing to absorb some of the price decline measured in their own currencies and the consequent squeeze on profit margins it entails in order to hold market share. in fact, given that the nearly 9 percent rise in dollar prices of goods imported from western europe since the start of 2002 has been far short of the rise in the euro, profit margins of euro - area exporters to the united states may well have turned negative. nonetheless, euro - area exports to the united states, when expressed in euros, have slowed only modestly. a possible reason is that european exporters'incentives to sell to the united states were diminished significantly less than indicated by the dollar price and exchange rate movements owing to accelerated short forward positions against the dollar in foreign exchange markets. a marked increase in foreign exchange derivative trading, especially in dollar - euro, according to the bank for international settlements, is consistent with increased hedging of exports to the united states and to other markets that use currencies tied to the u. s. dollar. 2 however, most contracts are short - term because long - term hed

the sme credit bureau also aims at promoting greater transparency, professionalism and sound credit culture among smes. smes can be assured that their good track records would be captured and evaluated by an independent third party, which in turn, would assist them to increase their financing and business opportunities. the credit reports would serve as a convenient tool for smes to carry out a self evaluation in identifying areas that needs improvement. this strategic alliance represents a meeting of the common objective of cgc and d & b to bridge the gaps in the availability and access to sme credit information in the country. the sme credit bureau is a big step towards a more sophisticated and transparent financing environment for smes in malaysia. both cgc, which is in the business of providing credit enhancement to malaysian smes ; and d & b, a global operator and provider of credit bureau services, are well equipped to drive this initiative forward. on this note, i would like to congratulate cgc and d & b malaysia sdn. bhd. in making this initiative possible. i am also confident that this will open up a new chapter in the history of credit bureaus and enable these entities to play an even greater role in the future development of the financial industry in malaysia.