SE Asian currencies depressed<\/p>\n
SINGAPORE (Reuter): The Singapore dollar's sudden drop through
\na key support level yesterday weighed heavily on other Southeast
\nAsian currencies by triggering fresh buying of the U.S. dollar
\nacross the board.<\/p>\n
The Singapore dollar fell through the psychological 1.50 to
\nthe U.S. dollar level in early trade and then slid to a 37-month
\nlow of 1.5140 on stop-loss sales before recovering a little.<\/p>\n
Dealers attributed the bulk of the move to comments by a
\nMonetary Authority of Singapore official who told reporters at an
\neconomic briefing that the Singapore dollar's level was
\nappropriate to what was happening in the market.<\/p>\n
The official of the de facto central bank said the U.S. dollar
\nhad been rising in currency markets and the Singapore dollar had
\ndepreciated by about five percent against the U.S. unit since the
\nstart of 1997.<\/p>\n
The Singapore dollar was quoted at 1.5075\/105 to the U.S.
\ndollar at 0855 GMT against 1.4850\/70 before the comments and
\ndealers said it was likely head towards 1.53.<\/p>\n
They said the market shrugged off news that Singapore's
\nmanufacturing sector expanded by 3.2 percent year on year in the
\nsecond quarter of 1997 after three consecutive quarters of
\ndecline.<\/p>\n
Singapore Prime Minister Goh Chok Tong said on Friday the
\neconomy was expanding faster than expected and would grow at
\nbetween six and seven percent in 1997.<\/p>\n
\"They're supposed to be good figures but now the market is
\nvery short of (U.S.) dollars and nobody is looking at
\nfundamentals at the moment,\" a U.S. bank dealer said.
\nThey said the drop in the sturdy Singapore dollar had set off
\nselling of other Southeast Asian currencies as players
\nincreasingly grouped the region's economies together.<\/p>\n
The U.S. bank dealer said the market was still short of U.S.
\ndollars and a lot of long-term players, portfolio managers and
\ncorporations were looking to hedge their exposure.<\/p>\n
The lack of aggressive intervention by Southeast Asian central
\nbanks was also playing a part in keeping regional currencies
\ndepressed, he said.<\/p>\n
\"The central banks realize that intervening aggressively just
\ngives the speculators a chance to buy cheap dollars. So they're
\nletting demand and supply determine the correct levels.\"<\/p>\n
The Malaysian ringgit recovered some composure after hitting a
\n42-month low of 2.7930 to the dollar in early trade.<\/p>\n
The Indonesian rupiah remained weak after coming under early
\npressure on spillover weakness from the ringgit and Singapore
\ndollar. It was quoted at 2,641\/44 against an early low of 2,655.<\/p>\n
Analysts said the central bank's move to cut short-term
\ninterest rates on Friday sent a signal to the market that it was
\nnot prepared to defend the rupiah at the expense of economic
\ngrowth.<\/p>\n
The Thai baht continued to look weak, but trading in the
\ncurrency was subdued with the Thai market closed for a holiday.
\nDealers said talk of an impending Thai cabinet reshuffle had
\nlittle impact as the market had largely priced it in due to the
\ncountry's economic crisis.<\/p>\n
The baht remained uninspired by news that the International
\nMonetary Fund and other Asian donors pledged a $16 billion loan
\npackage to Thailand on Monday.<\/p>\n
The Philippine peso weakened on heavy commercial demand for a
\ndollar in short supply. The peso was at 28.729\/800 to the dollar
\nat 0855 GMT against its previous close at 28.57.<\/p>\n
Only the Taiwan dollar firmed as the central bank made its
\npresence felt and domestic money market rates rose. It ended at
\nT$28.718 after hitting a day low of T$28.765 against a previous
\nclose at T$28.728<\/p>\n
Market -- Page 11<\/p>", "url": "https:\/\/jawawa.id\/newsitem\/se-asian-currencies-depressed-1447893297", "image": "" }, "sponsor": "Okusi Associates", "sponsor_url": "https:\/\/okusiassociates.com" }