SE Asian currencies hit new lows<\/p>\n
SINGAPORE (Reuter): The bedlam spreading through Southeast
\nAsian currencies showed no signs of easing yesterday as
\nMalaysia's efforts to prop up its collapsing stock market
\nworsened investor sentiment for the region.<\/p>\n
The already damaged benchmark Kuala Lumpur index dived to its
\nlowest level in four years, dropping by as much as 10.07 percent
\nat one point during the day before pulling back to close 2.62
\npercent down.<\/p>\n
The ringgit crashed through the 3.00 per dollar just before
\n0400 GMT and then extended its drop to a new all-time low of
\n3.0500. It also hit a new low against the Singapore dollar.<\/p>\n
It has lost more than two percent against the U.S. dollar in
\nless than a day and a fifth of its value since Southeast Asia's
\ncurrency mayhem began in July.<\/p>\n
"It's all sentiment driven now. If sentiment for the region
\ncontinues to be weak, we could find further pressure coming
\nthrough," said Song Seng Wun, regional economist at ABN-Amro
\nHoare Govett.<\/p>\n
Dealers and analysts said the market was spooked by Malaysia's
\nthreat to use the Internal Security Act, which allows for virtual
\nindefinite imprisonment without trial, against market
\n"manipulators".<\/p>\n
Prime Minister Mahathir Mohamad's attempt to bolster
\nconfidence with a huge stock market rescue plan achieved little,
\nmeeting with skepticism at best.<\/p>\n
"What the market wants to know is if the 60 billion ringgit
\nrescue package the Prime Minister announced for the stock market
\nyesterday will succeed or not," said Ishak Ismail, market
\nintelligence analyst at I.D.E.A.<\/p>\n
"The currency market is now paying a lot of attention to
\nwhat's going on in the KL stock market," a U.S. bank dealer in
\nSingapore said.<\/p>\n
"The 3.1 (dollar\/ringgit) level is not far away at all. It's
\nreally a question of where we go from there," he added.<\/p>\n
The Thai baht and Philippine peso were also driven to new lows
\nof 38.30 and 32.43 per dollar respectively.<\/p>\n
Bangkok dealers said political uncertainty and commercial
\ndemand for dollars continued to cloud the baht's outlook.<\/p>\n
But talk of possible central bank intervention above the 38.50
\nlevel and newly proposed measures to encourage exporters to
\nrepatriate overseas earnings could give the baht some relief.<\/p>\n
In the Philippines, the central bank was heard to have sold
\ndollars around the 32.43 and 32.39 peso levels, helping revive
\nthe peso, if only for the short term.<\/p>\n
In stark contrast, the Indonesian rupiah maintained a healthy
\ntone as the market responded positively to an economic reform
\npackage and central bank interest rate cuts.<\/p>\n
"Indonesia is taking some real steps, rather than Mahathir's
\nside-show of addressing the wrong issues," a senior European bank
\ndealer in Singapore said.<\/p>\n
The rupiah was at 3,030\/40 to the dollar at 1015 GMT against
\n3,020\/30 late on Wednesday. Jakarta stocks ended 4.15 percent
\nhigher.<\/p>",
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