Asian currencies mixed; expected lower next week<\/p>\n
SINGAPORE (Dow Jones): Asian currencies were mixed late
\nFriday, with the Thai baht and the Philippine peso resuming their
\nrecent downtrend, heralding more weakness for these Southeast
\nAsian units.<\/p>\n
The dollar had rebounded above the 41 baht psychological
\nresistance level, to trade at 41.225 baht in late trading, up
\nfrom 40.925 baht late Thursday.<\/p>\n
Against the peso, the dollar had risen to 44.980 peso earlier
\nFriday, but retreated to 44.860 peso late in the day, little
\nchanged from Thursday's close of 44.865 peso.<\/p>\n
The Singapore dollar continued its upward move after
\nThursday's strong gains, which were spurred by the Monetary
\nAuthority of Singapore's comments suggesting the local currency
\nmay be allowed to appreciate.<\/p>\n
The Indonesian rupiah was marginally firmer, although it
\nremained stuck within its recent trading range. Despite
\nheightened political uncertainty ahead of the country's National
\nAssembly next month, investors are hesitant to push the currency
\nlower, with the central bank having stepped up its vigilance to
\ndeter speculation against the rupiah.<\/p>\n
A 4.8 percent plunge in the South Korean stock market stung
\nthe won, while month-end U.S. dollar-demand from local importers
\nhelped support the New Taiwan dollar, dealers said.<\/p>\n
Political uncertainties in several Southeast Asian countries,
\nthe dollar's strength against the Japanese yen and strong local
\ncorporate demand for the U.S. currency will continue to pressure
\nAsian currencies next week, analysts said.<\/p>\n
\"Asian currencies will still maintain their weak tone,\" said
\nThio Chin Loo, a foreign exchange strategist at BNP Paribas.<\/p>\n
Meanwhile, market participants are awaiting the release of
\nU.S. second-quarter gross domestic product data due later Friday.<\/p>\n
\"Tonight's GDP will probably put to rest fears of a hard
\nlanding,\" said Thio.<\/p>\n
The Thai baht's rebound Thursday proved to be short-lived when
\nthe beleaguered currency - the latest target for Southeast Asian
\nbears - fell back below the 41 baht support level Friday, on
\ndollar-demand from local corporates and offshore dollar-buying,
\ndealers said. The Thai baht, which had been under heavy pressure
\nsince the start of the week, was pushed to a 10-month low
\nWednesday.<\/p>\n
Amid political uncertainty ahead of Thailand's general
\nelections later this year, many analysts expect the baht to
\nweaken beyond 42 baht to the dollar in the next few months.<\/p>\n
In fact, a slide toward 41.50 baht could come as early as next
\nweek, a dealer at an Asian bank said.<\/p>\n
The Thai authorities' apparent tolerance for a weak baht had
\nprovided the catalyst for offshore investors to push down the
\nbaht, dealers said.<\/p>\n
A Bank of Thailand official Friday denied a report that the
\ncentral bank intervened in the foreign exchange market in London
\ntrading hours this week to defend the baht against speculative
\ntrade.<\/p>\n
The baht's weakness is expected to continue dragging down the
\nPhilippine peso, which is already undermined by domestic
\npolitical uncertainties and concerns over the government's
\nyawning fiscal deficit.<\/p>\n
In other Southeast Asian currency markets, the movements of
\nthe rupiah and the Singapore dollar were tame.<\/p>\n
The dollar was at 8,935 rupiah, down slightly from Rp 8,963
\nlate Thursday. Keen dollar demand around Rp 8,900 will likely
\nkeep the U.S. currency buoyed, while Indonesian state banks and
\noffshore participants are expected to sell dollars around Rp
\n9,150, a dealer at a U.K. bank said.<\/p>\n
Against its Singapore counterpart, the U.S. currency was at
\nS$1.7322, down from S$1.7350. Participants are still smarting
\nfrom the de facto central bank's unexpected announcement Thursday
\nit was prepared to allow a modest appreciation of the Singapore
\ndollar in relation to the currencies of its major trading
\npartners.<\/p>\n
Elsewhere, foreign fund equity outflows on the local stock
\nmarket and dollar-buying in the non-deliverable forward market
\ndented the South Korean won, dealers said.<\/p>\n
The dollar finished at 1,116.60 won, up from Thursday's close
\nof 1,113.40 won.<\/p>\n
The won, which has been outperforming its other ailing Asian
\ncounterparts in recent months, could weaken further next week
\nwith the yen's weakness and as the stock market is pressured by
\nconcerns over the health of the country's conglomerates, said
\nThio at BNP Paribas.<\/p>\n
If the dollar breaks 1,120 won, it is set to strengthen to
\n1,130 won thereafter, she added.<\/p>\n
Against the New Taiwan dollar, the U.S. currency was at
\nNT$31.050, barely changed from Thursday's close of NT$31.052.<\/p>",
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