Soft dollar helps poor Asian currencies<\/p>\n
SINGAPORE (Reuters): Asian currencies firmed on the back of a
\nlower U.S. dollar on Thursday as activity dwindled to commercial
\nflows after the previous day's sharp falls caught many interbank
\ntraders short of dollars.<\/p>\n
Dealers said the dollar's drop to three-month lows against the
\nyen overnight kept Asian currencies on relatively firm footing,
\nbut they showed little inclination to revisit recent highs.<\/p>\n
"The stronger yen should enable Japanese companies, that have
\nbeen providing funds to Asian countries, to roll over their
\ndebts," the head of regional currencies trading at a European
\nbank in Singapore said.<\/p>\n
"But the interest is more on demand and supply today. There's
\nnot much interbank activity going on because some players were
\nhurt by yesterday's moves," he said.<\/p>\n
The Thai baht's abrupt drop late on Wednesday from highs near
\n46.00 to the dollar triggered falls in other Southeast Asian
\ncurrencies, which had been climbing steadily this week after
\nBangkok scrapped a two-tier trading system and Indonesia took
\nsteps to address its corporate debt problems.<\/p>\n
Dealers attributed the baht's fall to a range of factors
\nincluding fears about King Bhumibol Adulyadej's health and a huge
\nThai corporate order for dollars to settle debt payments.<\/p>\n
"Local Thai companies had to buy about $300 million for a loan
\nredemption and the market was short. U.S. funds joined in the
\nselling when the dollar broke 49.00 and that exacerbated the
\nbaht's fall," the dealer said.<\/p>\n
The baht firmed back above the 50 per dollar level on Thursday
\nas concerns about the king eased after he appeared on television
\non Wednesday night.<\/p>\n
But dealers said dollar demand from U.S. and Thai names would
\nblock its rise near the 47.50 level to the dollar.<\/p>\n
The Indonesian rupiah hovered below the 9,000 per dollar
\nlevel, but dealers said fears of central bank intervention would
\nlimit its falls to 10,000 for the time being.<\/p>\n
The Malaysian ringgit remained above 4.00 to the dollar for
\nmost of the day after recovering in overseas markets on comments
\nby Finance Minister Anwar Ibrahim.<\/p>\n
The Singapore dollar nudged higher in late trade after the
\nThai Bankers' Association said it favored using the Singapore
\ndollar as common currency for trading within the Association of
\nSoutheast Asian Nations (ASEAN).<\/p>\n
The Philippine peso ceded some ground to importer demand for
\ndollars around the 40 level, while portfolio flows to the stock
\nmarket fizzled out.<\/p>\n
The Taiwan dollar finished higher for the fourth straight day,
\ngaining from the yen's rise and expected foreign inflows to the
\nstock market.<\/p>\n
Taiwan's stock index has risen 6.64 percent since Monday,
\nForeign funds bought a net T$3.7 billion worth of Taipei stocks
\non Wednesday.<\/p>\n
The Hong Kong dollar was steady but dealers cited fears of
\nrising interest rates amid indications players were beginning to
\ntake long-term short positions in the currency.<\/p>",
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