Won drops, Asian currencies poised for weekly gain<\/p>\n
Bloomberg, Singapore<\/p>\n
South Korea's won fell for the second day on speculation the
\ncentral bank will sell it to protect the earnings of exporters
\nafter an official said that the currency rose \"too fast.\"<\/p>\n
The won's 0.5 percent gain against the dollar this weak
\nthreatens to erode the competitiveness of companies such as
\nHyundai Motor Co., the nation's biggest automaker.<\/p>\n
The Bank of Korea is monitoring the won's performance versus
\nthe dollar and the yen, Oh Jae Kwon, head of the central bank's
\nforeign- exchange team in Seoul, said.<\/p>\n
The won declined 0.5 percent to 1,038.10 against the dollar as
\nof 4 p.m. local time, according to Seoul Money Brokerage Services
\nLtd.<\/p>\n
\"Everybody thinks the authorities want to keep the won from
\nrising past 1,030,\" said Sam Hong, a currency derivatives
\ndepartment manager at Shinhan Bank in Seoul. \"The authorities
\nwill strongly intervene.\"<\/p>\n
Exports account for about 40 percent of the Korean economy.
\nThe commerce ministry on Jan. 4 forecast export growth will slow
\nto 12 percent this year from 31 percent in 2004, partly because
\nof the won's appreciation.<\/p>\n
South Korea's central bank on Dec. 2 said it bought dollars to
\nstall won gains. Currency holdings rose to a record $199.1
\nbillion last month, the bank said on Jan. 4.<\/p>\n
The Taiwan dollar fell for a second day after the benchmark
\nstock index dropped, fanning speculation investors abroad will
\nincrease sales of the island's shares.<\/p>\n
Overseas money managers on Thursday sold a net NT$5.6 billion
\n($176 million) of Taiwan's stocks, the most since Jan. 5,
\naccording to stock exchange figures. The Taiex index of equities
\nhad a weekly decline.<\/p>\n
Taiwan's dollar fell 0.1 percent to NT$31.919, according to
\nTaipei Forex Inc. The currency may slide as low as NT$32.05
\ntoday, Ho said.<\/p>\n
Other Asian currencies also fell after Johnson & Johnson, the
\nworld's biggest maker of medical devices, said it will return
\nabout $11 billion in overseas profit to the U.S., taking
\nadvantage of a one-year tax break.<\/p>\n
\"The dollar rose against Asian currencies because of the
\nreport on Johnson & Johnson sending the money into the U.S.,\"
\nsaid Rafael Algarra, head of currency and fixed-income trading at
\nSecurity Bank Corp. in Manila.<\/p>\n
Thailand's baht weakened 0.1 percent to 38.60 and the
\nSingapore dollar fell 0.1 percent to S$1.6387. Trading may be
\nless than usual in the city-state because financial markets were
\nclosed for a holiday.<\/p>\n
The Philippine peso weakened 0.1 percent to 55.53, according
\nto the Bankers Association of the Philippines. The currency may
\ntrade between 55.55 and 55.65 through next week, Algarra said.<\/p>\n
Philippine Finance Secretary Juanita Amatong, who helped the
\nadministration of President Gloria Arroyo narrow the nation's
\nbudget deficit, said she's resigning after more than a year in
\noffice. She said she expects Trade Secretary Cesar Purisima to
\nreplace her.<\/p>\n
\"It's neutral news\" for the peso, Security Bank Corp.'s
\nAlgarra said. \"There was a resignation, but Purisima is highly
\nvalued by the market.\"<\/p>\n
The region's currencies were poised for a weekly gain on
\nspeculation China and Malaysia will alter their pegged exchange
\nrates to allow for gains.<\/p>\n
China will probably let its currency appreciate against the
\ndollar by the end of June, Merrill Lynch & Co. yesterday said in
\nan interview.<\/p>\n
Merrill, the world's largest securities firm, expects that
\nfaster inflation will prompt policy makers in China to revalue
\nthe yuan 10 percent higher against the U.S. currency, it said.<\/p>",
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