Asian currencies down late on yen, won the hardest hit

Asian currencies down late on yen, won the hardest hit

SINGAPORE (Dow Jones): Asian currencies tumbled late Friday,
as the dollar's surge to its highest level against the Japanese
yen since October 1998 underscored the U.S. currency's safe haven
status, dealers said.

The South Korean won was the biggest casualty of the yen's
plunge, as it slid to its lowest level since October 1998.

With offshore foreign exchange traders paying scant attention
to the Indonesian rupiah, the currency was steady at Rp 10,415
against the dollar, little changed from Rp 10,430 late Thursday.

The dollar fell to an intraday low of Rp 10,375 Friday after
state banks sold the U.S. currency on behalf of the central bank.

But it rebounded to close the day unchanged from Thursday's
close at Rp 10,415.

The dollar is likely to trade in a Rp 10,375 to Rp 10,500
range next week, traders said.

Regional dollar strength, especially against the yen, is also
keeping a dollar bullish tone against the rupiah, they added.

Late in the day, the dollar muscled its way through the
psychologically important Y125 level after Japan's Economy and
Finance Minister Taro Aso confirmed the U.S. had contemplated a
pact with Japan to lower the yen at their summit meeting early
March.

At 0900 GMT, the dollar was quoted at Y125.26, up from Y123.70
late Thursday in New York, but slightly off its intraday high of
Y125.50.

The won felt the brunt of the pain in Asian foreign exchange
markets, losing almost 1 percent of its value in early trading
before recouping part of its losses late in the day.

The South Korean currency closed at 1,327.5 won to the dollar,
its weakest level since Oct. 20, 1998. The dollar was at 1,318.6
won Thursday.

The won's plunge to as low as 1,331 won in early trading had
provoked verbal intervention from South Korea's Ministry of
Finance and Economy, saying it was ready to take needed steps to
keep the currency from weakening further.

The floundering yen also dealt a blow to the New Taiwan
dollar, the Singapore dollar and the Thai baht.

The Taiwan central bank's reduction Thursday of its discount
and secured loan rate by 12.5 basis points each also helped step
up the New Taiwan dollar's decline.

While some market observers had expected the central bank to
lower the rate by 25 basis points, the smaller-than-expected cut
could be seen as "an attempt to limit the pressure on the New
Taiwan dollar", given the central bank's concern about the
currency's weakness, said Gong at Bank of America.

The U.S. dollar closed at NT$32.837, above NT$32.757 Thursday,
but off Friday's intraday high of NT$32.898.

While suspected intervention by the Monetary Authority had
helped the Singapore dollar rebound to as high as S$1.7953
against its U.S. counterpart in early trading, the currency
faltered as the yen lost ground and subsequently broke below the
Y125 mark against the dollar. The euro's vulnerability, after the
European Central Bank decided to leave interest rates unchanged,
also cast a shadow on the Singapore dollar.

At 0930 GMT, the Singapore dollar was at a 38-month low of
S$1.8042 to the U.S. currency, compared with S$1.7992 late
Thursday.

In the Thai currency market, the dollar was hovering slightly
below the psychologically important 45 baht mark.

The dollar was at 44.985 baht, up from 44.765 baht late
Thursday.

The regional currency malaise rubbed off on the Philippine
currency, which ended at its intraday low of 49.51 pesos against
the dollar, compared with 49.355 pesos Thursday.