Dollar overcomes early loses<\/p>\n
Alan Yonan Jr, Dow Jones, Singapore<\/p>\n
The dollar recovered from early losses to finish mixed against
\nAsian currencies Wednesday.<\/p>\n
The dollar was weaker across the board in early Asian trading,
\nbut capitalized on its gains against the yen later in the session
\nto close higher against the South Korean won and Thai baht.<\/p>\n
The Singapore dollar, New Taiwan dollar, Philippine peso, and
\nIndonesian rupiah strengthened modestly against the dollar.<\/p>\n
The peso rallied for the third straight session, even as the
\nCongressional Planning and budget office cautioned that the
\ngovernment's 2002 budget deficit could widen substantially if tax
\ncollection doesn't improve.<\/p>\n
The dollar closed at 51.900 pesos on the Philippine Dealing
\nSystem, down from 52.100 pesos a day earlier.<\/p>\n
A study prepared by the budget office warned that the deficit
\ncould balloon to 172 billion pesos, well beyond the 150 billion
\npesos to 155 billion pesos that most private analysts are
\nforecasting.<\/p>\n
The budget deficit for the first seven months of the year
\nstood at 133 billion pesos, exceeding the government's full-year
\ntarget of 130 billion pesos.<\/p>\n
"The market's response, or rather lack of it, seems to suggest
\nthat it is already braced for the worst, or maybe that it would
\nlike to wait to get a clearer picture to emerge on the extent of
\nthe deficit overshoot," Bank of America said in a daily research
\nnote.<\/p>\n
For his part, Finance Secretary Jose Isidro Camacho said he
\nwouldn't declare the budget shortfall "unmanageable" because
\ndoing so would only hurt business confidence.<\/p>\n
While such a declaration would give the federal government the
\nlegal authority to reduce payments to local governments that are
\nfixed by law, the net result would be negative, Camacho said.<\/p>\n
"Whatever you gain from that may not be enough to compensate
\nfor the backlash it might have on the confidence of corporations
\nand local governments," he said.<\/p>\n
The won suffered from yen weakness and foreign selling of
\nshares in the local stock market.<\/p>\n
The dollar closed at 1,201.0 won, up from 1,200.0 won at
\nTuesday's close.<\/p>\n
The won opened firmer at 1,195 per dollar in line with the
\nyen's initial strength, but lost ground as the Japanese currency
\nfaltered in the afternoon session.<\/p>\n
The dollar traded as high at 118.65 yen in Asia, compared with
\n118.14 yen late Tuesday in New York.<\/p>\n
In addition, foreigners were net sellers of local shares for
\nthe third straight day Wednesday, bringing the three-day total to
\n336 billion won in net sales.<\/p>\n
The New Taiwan dollar gave up most of its early gains, but
\nstill managed to close a touch stronger against the dollar.<\/p>\n
The U.S. currency ended at NT$34.230, compared with Tuesday's
\nclose of NT$34.236.<\/p>\n
The dollar hit an intraday low of NT34.165 early in the day,
\nbut battled back as the local currency was hit by outflows of
\nforeign equity funds and the weaker yen.<\/p>\n
The Singapore dollar held its ground against the U.S. currency
\nin a quiet, range bound session, dealers said.<\/p>\n
Late in Asia the U.S. dollar was quoted at S$1.7488, down from
\nS$1.7537 late in Asia Tuesday.<\/p>\n
The rupiah gained on dollar selling by state banks, possibly
\nat the request of the central bank, traders said.<\/p>\n
The dollar ended at Rp 8,880, down from Rp 8,905 at Tuesday's
\nclose.<\/p>\n
The dollar was pulled off its intraday high at Rp 8,900, on
\ndollar selling by state banks.<\/p>\n
Traders said the selling was likely on behalf of the central
\nbank to help keep the lid on dollar strength.<\/p>\n
With a lack of fresh leads to drive baht trading, the currency
\nweakened a trough in tandem with the softer yen.<\/p>\n
Near the end of Asian trading the dollar was quoted at 42.425
\nbath, up from 42.235 bath late Tuesday.<\/p>",
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