S'pore dollar, rupiah lead currency slide<\/p>\n
HONG KONG (Dow Jones): Falls in the Singapore dollar and the
\nIndonesian rupiah dragged other Southeast Asian currencies lower
\nWednesday. North Asian currencies were unaffected, with the
\nKorean won closing flat on the day, and the New Taiwan dollar
\nedging higher.<\/p>\n
The weakness of the Singapore dollar over recent sessions has
\ntaken many market participants by surprise. Both corporate and
\ninstitutional customers loaded up on the Singapore currency ahead
\nof the New Year in anticipation of strong appreciation this year.<\/p>\n
Further local currency buying was seen last week from market
\nplayers encouraged by a Standard Chartered Bank research report
\nforecasting a 10% strengthening in 2000, with the U.S. dollar
\nseen falling to end the year at S$1.5000.<\/p>\n
But a rally in the U.S. dollar against the yen and what
\ntraders describe as aggressive buying of the U.S. dollar by the
\nMonetary Authority of Singapore has clouded that picture in the
\nshort term.<\/p>\n
As the U.S. dollar has risen through successive trigger
\nlevels, customers have scaled down their hedges and cut back long
\npositions in the Singapore currency, driving the U.S. dollar
\nhigher still.<\/p>\n
Wednesday morning the U.S. currency was propelled as high as
\nS$1.6908 against the Singapore dollar, its highest level since
\nearly October.<\/p>\n
By the end of Asian trading, the U.S. dollar had eased a
\nlittle from its earlier peak, but at S$1.6892, the U.S. currency
\nremained well above levels of S$1.6845 seen late the day before.<\/p>\n
Although traders believe the Singapore dollar is undervalued
\nat current levels, some warned that the local currency could
\nweaken further to S$1.70 to the U.S. dollar in the short term.<\/p>\n
\"I certainly wouldn't dare go long the (U.S.) dollar at
\nS$1.69, it would be fundamentally wrong, but if fund managers'
\nconfidence is shaken any further, we may see more short
\ncovering,\" said the head of regional currencies at one U.S. bank
\nin Singapore.<\/p>\n
Another trading chief said that, left to itself, the U.S.
\ndollar is unlikely to extend its gains beyond S$1.6930, but added
\nthat further buying from the Monetary Authority of Singapore
\ncould push it higher still.<\/p>\n
\"We expected the MAS to support the U.S. dollar, but not at
\nthese levels,\" he said.<\/p>\n
The Indonesian rupiah also weakened Wednesday as violence
\nflared afresh in Aceh, despite a visit from Indonesian President
\nAbdurrahman Wahid intended to soothe tensions in the troubled
\nnorth Sumatran province.<\/p>\n
Dealers were also unnerved by reports that the president had
\nsacked eight senior generals, including General Wiranto, the
\nsenior security minister, from their military posts in an attempt
\nto weaken the army's grip on Indonesian politics.<\/p>\n
\"Because of all this political uncertainty, people are
\nreluctant to sell dollars (against the rupiah) as an economic
\nrecovery play,\" one trader said.<\/p>\n
The market's jitters pushed the dollar as high as 7,380 rupiah
\nin intraday trading. Late in Asia, the U.S. currency was quoted
\nat Rp 7,375, up from Rp 7,320 late Tuesday.<\/p>\n
Both the Thai baht and the Philippine peso followed the
\nSingapore dollar and the rupiah lower Wednesday.<\/p>\n
Against the baht, the U.S. dollar ended trading at 37.315
\nbaht, up from 37.265 baht the previous day.<\/p>\n
Against the Philippine peso the U.S. dollar closed at 40.495
\npeso, up from 40.445 peso the day before.<\/p>\n
In North Asia, the dollar closed flat against the South Korean
\nwon, ending the session at 1,127.20 won compared with 1,127.10
\nwon Tuesday.<\/p>\n
Against the New Taiwan dollar, the U.S. currency ended at
\nNT$30.794, down from NT$30.813 the previous day, on fund inflows
\nattributed primarily to foreign portfolio investors.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/spore-dollar-rupiah-lead-currency-slide-1447893297",
"image": ""
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"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
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