Asian Currencies down, dollar recovers after recent slide

Asian Currencies down, dollar recovers after recent slide

Dow Jones
Singapore

Most Asian currencies weakened on Thursday in holiday-thinned
trading as the dollar took a breather from its recent slide in
the region.

The Thai baht, Indonesian rupiah and Philippine peso all edged
lower against the dollar in cautious trading on the second
anniversary of the Sept. 11 terrorist attacks in the U.S.

The Singapore dollar was little changed, and the South Korean
won and New Taiwan dollar weren't traded because financial
markets in Seoul and Taipei were closed for public holidays.

The dollar bounced back against the baht after hitting a 14-
month low against the Thai currency a day earlier.

Traders said demand for the U.S. currency came from banks
stocking up on dollars as they prepared to establish loan
facilities with Thai state-owned enterprises seeking dollars for
foreign debt repayment.

Offshore players also bought dollars to cover their short
positions in the U.S. currency.

Late in Asian trading the dollar was quoted at 40.445 baht,
off its morning high of 40.520 baht, but still up from 40.375
baht late on Wednesday.

The strength of the baht, which is up 6.5 percent against the
dollar so far this year, has prompted Thai officials to intervene
to slow the baht's rise, and crack down on speculative trading of
the currency.

Nonetheless, central bank Governor Pridiyathorn Devakula has
indicated he is comfortable with the baht's appreciation because
it has been broadly in line with other regional currencies.

The Singapore dollar continued to hold its ground following
the confirmation earlier this week of the first case of SARS in
the city-state in four months.

Near the end of Asian trading the U.S. dollar was quoted at
S$1.7481 compared with S$1.7482 late in Asia on Wednesday. The
U.S. dollar traded between S$1.7473 and S$1.7516 intraday.

But trade in the local currency market was very thin, and the
U.S. dollar spent much of the session hovering around S$1.7490.
Market participants were cautious due to the possibility of
terrorist strikes to coincide with the second anniversary of the
Sept. 11 attacks.

The peso relinquished its early gains to finish lower against
the dollar.

The Philippine currency initially strengthened on suspected
central bank intervention, but dollar buyers emerged after the
U.S. currency fell as low as 54.890 peso.

Market players remain generally bearish toward the peso due
mostly to concerns about the political and security stability in
the Philippines.

The dollar buying continued throughout the session, pushing it
to 55.030 peso at the close, up from 54.950 peso late on
Wednesday.

The rupiah weakened as players covered short dollar positions
after the U.S. currency's rise in the region.

Late in Asia the dollar was quoted at Rp 8,465, up from Rp
8,430 late Wednesday.

With little in the way of fresh news to trade on, market
players looked at the movement of other regional currencies for
guidance.