Rupiah sold down on presidential poll fears<\/p>\n
HONG KONG (Dow Jones): The foreign exchange market reacted
\nnervously to Indonesian President B.J. Habibie's selection of
\narmed forces' chief General Wiranto as his running mate in
\nIndonesia's presidential election, selling the rupiah down
\nsteeply against the dollar in Asian trading Wednesday.<\/p>\n
Activity in other East Asian markets was subdued, with dealers
\ngenerally bidding the dollar higher against the regional
\ncurrencies, partly on fears of heightened tensions in South Asia
\nfollowing Tuesday's military coup in Pakistan.<\/p>\n
Habibie's choice of Wiranto as his vice presidential candidate
\nin the Oct. 20 election triggered a flurry of dollar purchases
\nagainst the rupiah, largely executed by state-owned banks in
\nJakarta, according to dealers in the offshore market.<\/p>\n
The volume of dollar bids was easily sufficient to clear out
\nthe offers which had previously capped the U.S. currency at Rp
\n8,000. With little resistance seen, and most of the news emerging
\nfrom Jakarta seen as bad, most traders expected the dollar to
\nappreciate further in the near term.<\/p>\n
\"It looks as if Habibie is trying to draw army votes away from
\nMegawati, who is the market's favorite candidate, so in the short
\nterm people will buy dollars,\" said Simon Flint, senior currency
\nstrategist at Bank of America in Hong Kong.<\/p>\n
Wiranto had been expected to throw his weight behind Megawati
\nSoekarnoputri, the popular choice for president. He is regarded
\nas a key power broker, not least because of the 38 seats
\ncontrolled by the military in the 700-seat People's Consultative
\nAssembly which is to elect the president.<\/p>\n
By late in Asian trading, the dollar had been bid as high as
\nRp 8,080, up over 3 percent from Rp 7,827 late the previous day.<\/p>\n
Other regional currencies for the most part took a back seat
\nto the rupiah, but the Singapore dollar, the Thai baht and the
\nPhilippine peso all ended the day lower against the U.S.
\ncurrency.<\/p>\n
Although the coup in Pakistan wasn't a major factor
\ninfluencing trading, some dealers and analysts did mention fears
\nof rising tensions between Pakistan and India as a reason to buy
\ndollars against Asian currencies.<\/p>\n
Any escalation in border clashes between the two nuclear
\npowers is likely to take some of the shine off Asian currencies
\nin general, as nervous investors trim their exposure to the
\nregion as a whole.<\/p>\n
The fall in the Singapore currency was attributed to U.S.
\nbanks, which were said by traders to be buying U.S. dollars
\nfollowing intervention by the Monetary Authority of Singapore on
\nTuesday.<\/p>\n
Late on Wednesday, the U.S. dollar was quoted at S$1.6839, up
\nfrom S$1.6791 toward the end of Asian trading the day before.<\/p>\n
The Thai baht also fell Wednesday, although traders played
\ndown the significance of the decline, saying some profit-taking
\nis only natural following the baht's 5 percent rise over the last
\ntwo weeks.<\/p>\n
Late in Asian dealing, the U.S. dollar was quoted against the
\nbaht at 39.65 baht, up from 39.45 baht late the day before.<\/p>\n
The Philippine peso also closed a touch lower, with the U.S.
\ndollar rising to finish the domestic session up at 40.440 pesos
\ncompared with 40.270 pesos Tuesday.<\/p>\n
The South Korean won closed unchanged on the day after a round
\nof U.S. dollar short covering late in the day erased the local
\ncurrency's earlier gains.<\/p>\n
At the close the U.S. currency was quoted at 1,205.10 won, the
\nsame level as at the previous day's close.<\/p>\n
The New Taiwan dollar closed down marginally in line with the
\nregional trend. At the close, the U.S. dollar was at NT$31.772,
\nup from NT$31.768 the day before.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/rupiah-sold-down-on-presidential-poll-fears-1447893297",
"image": ""
},
"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
}