Thai baht strengthens to a record 1-month high<\/p>\n
SINGAPORE (Bloomberg): The Thai baht strengthened to its
\nstrongest in more than two months Thursday as other Southeast
\nAsian currencies were little changed.<\/p>\n
Dealers said baht rose 0.8 percent to 40.13 to the U.S.
\ndollar, its strongest since July 17, as the flow of new
\ninvestment into the country boosts demand for the currency.<\/p>\n
\"Economy-wise, Thailand still isn't in too good a shape, but
\non the trade front, they are continuing to post surpluses, which
\nis good for the currency,\" said Terence Ngooi, senior manager for
\nstrategic trading at Sanwa Bank in Singapore.<\/p>\n
Thailand's current account -- an indicator of the flow of
\ntrade, services and investments into and out of a country -- has
\nshown a surplus each month since Sept. 1997. Before that, no
\nmonthly surplus was recorded for 11 years.<\/p>\n
Last year, Thai domestic demand for imported goods collapsed
\nfollowing the baht's devaluation. Yet, the weaker currency made
\nThai exports more competitive and boosted demand for the
\ncountry's currency to pay for Thai goods and services.<\/p>\n
Other Southeast Asian currencies were little changed as
\ntraders looked to more volatile currencies like the Deutsche mark
\nand Japanese yen for money-making opportunities.<\/p>\n
\"Traders are steering away from trading the Asian currencies
\n-- the risks are greater and there are fewer opportunities to
\nmake money,\" said Derek Kwok, chief trader at Credit Agricole
\nIndosuez.<\/p>\n
The rupiah was little changed at 11,020 to the U.S. dollar.
\nThe Malaysian ringgit was at 3.80, where it has stood since the
\nexchange rate was fixed by the government on Sept. 2. The
\nSingapore dollar rose 0.4 percent to 1.7212. The Philippine peso
\nwas little changed at 44.459.<\/p>\n
Earlier this month, Malaysia introduced capital controls that
\nincluded a ban on trading the ringgit outside the country. The
\nmove -- aimed at stopping speculation that sent the ringgit on a
\nroller-coaster ride for most of the last 12 months -- raised
\nfears other Asian countries may do the same, increasing the risk
\nof being unable to settle trades.<\/p>\n
The yen fell against the dollar for a fifth day, touching a
\ntwo-week low, as currency traders remained skeptical Japan will
\nbe able to restore health to the debt-plagued banking industry
\nanytime soon.<\/p>\n
U.S. President Bill Clinton on Tuesday urged Japanese Prime
\nMinister Keizo Obuchi to use public money to aid troubled banks,
\naccording to U.S. Deputy Treasury Secretary Lawrence Summers. Yet
\nJapan's opposition parties are reluctant to do so.<\/p>\n
\"Despite the U.S. request, the Japanese problem isn't likely
\nto be settled easily because of the wide gap between the ruling
\nand opposition parties,\" said Tetsuhisa Hayashi, a foreign
\nexchange manager at Bank of Tokyo-Mitsubishi Ltd. \"The yen was
\nsold because of the credit risk.\"<\/p>\n
The yen reached 137.22 to the dollar, its lowest since Sept.
\n9. It was recently quoted at 136.84, down from 135.58 in late New
\nYork trading Wednesday.<\/p>\n
The Australian dollar was little changed, paring earlier
\nlosses, as the U.S. dollar weakened after Federal Reserve
\nChairman Alan Greenspan hinted the U.S. may cut interest rates.<\/p>\n
Still, gains in the Australian dollar where checked by
\ninvestor concerns that a national election to be held on Oct. 3,
\ncould result in the winning party failing to secure a big enough
\nmajority to manage the economy effectively.<\/p>\n
The Australian dollar, or Aussie, was little changed at to
\n58.17 U.S. cents from 58.00 cents late yesterday.<\/p>\n
\"In the medium term, talk of a rate cut will be a positive for
\nthe Aussie,\" said Geoff Bowmer, vice-president of foreign
\nexchange at Bankers Trust Australia. \"But the impact .. will be
\nlimited in the short term until investors\" see the election
\noutcome.<\/p>\n
Investors are concerned the right wing One-Nation party,
\ncampaigning on a platform of protectionism, could hold the
\nbalance of power. Latest opinion polls show voter support for
\nPrime Minister John Howard's conservative coalition at 42 percent
\nand the opposition Labor party at 43 percent with One Nation at 6
\npercent.<\/p>",
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