Ringgit, rupiah hit new lows as demand for dollar higher<\/p>\n
SINGAPORE (AFP): The Malaysian ringgit and Indonesian rupiah
\ncollapsed to new lows yesterday as demand for U.S. dollars and
\nrenewed jitters sent the greenback soaring against regional
\ncurrencies, dealers and analysts said.<\/p>\n
The ringgit fell to as low as 3.2000 to the dollar and the
\nrupiah sank to 3,220, before closing at 3.1950 ringgit and 3,1950
\nrupiah per dollar, dragging other weary Southeast Asian
\ncurrencies down with them in the process.<\/p>\n
Since the regional financial crisis began with the Thai baht's
\nde facto devaluation on July 2, the Malaysian currency has lost
\nalmost 27 percent of its value, while the Indonesian unit has
\nlost 31 percent.<\/p>\n
\"This is beyond rational thinking already,\" said Sani Hamid,
\nan emerging markets analyst with research house Standard and
\nPoor's MMS in Singapore.<\/p>\n
\"You cannot pin it down to anything. The general sentiment
\namong dealers is no one wants to be short (on the dollar),\" he
\nsaid.<\/p>\n
\"It's Monday. The first thing you do when you come in is to
\nlook for a reason to buy dollars and any little excuse is an
\nexcuse.\"<\/p>\n
He said the fact it was nearing the end of the month and the
\nend of the third quarter stoked demand for dollars from
\ncompanies. Liquidity in Malaysia and Indonesia also prompted
\ndollar buying, he added.<\/p>\n
The Singapore dollar, tracking the other regional currencies,
\nclosed lower at 1.5285 to the U.S. dollar, from its close last
\nweek of 1.5230. It hit a low of 1.5350 yesterday.<\/p>\n
The Philippine peso fell to as low as 34.01 to the dollar
\nbefore closing at 33.99. Analysts attributed its weakness to the
\nafter-effects of last Friday's downgrade of the country's long-
\nterm foreign and local currency credit outlook by rating agency
\nStandard and Poor's, after a downgrade of Malaysia's outlook.<\/p>\n
The Thai baht also ended lower yesterday but was comparatively
\nstable at 35.75 to the dollar offshore, from its close of 35.20
\nlast week, after the Thai parliament over the weekend approved a
\nnew \"anti-sleaze\" constitution and voted down a censure motion
\nagainst Premier Chavalit Yongchaiyudh.<\/p>\n
Maya Pinto, regional economist with British financial house
\nI.D.E.A., said a combination of factors caused fresh weakness in
\nsoutheast Asian currencies and predicted volatility for the rest
\nof the week.<\/p>\n
\"In Indonesia there are worries over the financial sector.
\nSome banks are facing liquidity problems,\" she said.<\/p>\n
\"The Thai baht is pretty strong because the weekend political
\ndevelopments came in as expected,\" she said. \"There are no
\nunpleasant surprises.\"<\/p>\n
She said part of the reason the ringgit was weak was that
\nMalaysian Foreign Minister Adbullah Ahmad Badawi issued another
\nattack on foreign currency speculators over the weekend.<\/p>\n
In a hard-hitting speech to the UN General Assembly session
\nFriday, the minister repeated his government's accusations
\nagainst foreign speculators.<\/p>\n
Recalling the recent plunge of stock prices and the fall of
\nthe Malaysian ringgit, the minister said the sequence of events
\n\"did not take place as a result of war, conflict, natural
\ndisaster or mismanagement.<\/p>\n
\"It was precipitated by currency speculators, indeed
\nmanipulators, who driven by sheer greed took advantage of the
\nvulnerabilities of developing economies especially the fragility
\nof their nascent financial markets,\" he said.<\/p>\n
Malaysia has come under market pressure to put its economy in
\norder and avoid policy flip-flops that have alarmed the market.<\/p>\n
The ringgit was clobbered earlier this month after Malaysian
\nPremier Mahathir Mohamad called for curbs on currency trading.
\nAides later said there was no plan to impose market controls.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/ringgit-rupiah-hit-new-lows-as-demand-for-dollar-higher-1447893297",
"image": ""
},
"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
}