Asian currencies drift higher over speculation on U.S. data
Asian currencies drift higher over speculation on U.S. data
SINGAPORE (Agencies): Southeast Asian currencies were drifting higher against the U.S. dollar in lackluster trading late Friday.
Traders said markets bereft of fresh news had kept participants largely on the sidelines ahead of the weekend and the release of key U.S. economic data later in the global session.
The Singapore dollar, Thai baht and Philippine peso strengthened slightly, as the U.S. dollar moved sideways between 121.40 yen and 121.70 yen during the Asian session, Dow Jones reported.
Only the New Taiwan dollar managed to end lower on the day, although traders said the central bank's overt presence in the market kept the U.S. dollar trading within a tight range.
At 08:00 GMT (4:00 a.m. EDT), the U.S. dollar was trading at NT$32.738, up slightly from NT$32.733 late Thursday.
Against the Singapore dollar, the U.S. dollar was at S$1.7265, down a touch from S$1.7270 late Thursday.
"The market is thin today as most feel the Singapore dollar's direction will be dictated by what happens in Indonesia next week," a trader at a UK bank in Singapore said. "Any major violence and we'll see a selloff in the regional currencies against the U.S. dollar."
The U.S. dollar was also trading at 38.0227 Philippine pesos in late Asian trading, down from 38.0400 pesos late Thursday.
"The Philippines is enjoying a clear economic recovery, and the growth is far more sustainable than growth seen elsewhere in the region," said Desmond Supple, regional economist at Barclays Capital in Singapore. "A recovering economy also means there is less of a need for an undervalued exchange rate. The current U.S. dollar/peso level appears competitive within the region, and that is demonstrated by the country's export growth."
On a three-month moving average, Philippine exports are up 10 percent, while other countries' export volumes have remained broadly flat, he said.
Favorable May inflation figures also pave the way for "greater flexibility in monetary management" in the form of further overnight rate cuts, Amando Tetangco, managing director of the Philippine central bank, said Friday. Inflation in May was 6.7 percent year-on-year, lower than the 7.9 percent rise in April.
His comments are in line with central bank Governor Gabriel Singson's previous statement that overnight borrowing and lending rates - now at 9.875 percent and 11.875 percent, respectively - would be cut Monday if May's inflation figures turned out to be lower than April's.
In North Asia, the U.S. dollar was trading at 1183.9 Korean won, down from 1184.70 won late Thursday.
In London, the euro single currency crashed down to a new low value against the dollar here early on Friday, before publication of U.S. jobs data that was eagerly awaited by market traders.
The euro was being traded at $1.0297 here in early trading from $1.0349 at the close of trade on Thursday, AFP reported.
The currency had hit a new low point of $1.0289 on the London market earlier in the session. Dealers said that the euro had fallen as low as $1.0270 overnight on the international markets.
The renewed weakness of the fledgling currency followed a tentative recovery ignited by the move towards peace in Yugoslavia announced during the previous day's trade.
A currency analyst at Paribas bank, Nick Parsons, said that hopes of peace in Kosovo came as scant relief to the beleaguered currency.
With all eyes focused on euro rates, there was little change in the other leading currencies. Dollar-yen rates were broadly stable, but the pound followed the dollar up to a new high against the euro.
The euro was being traded at $1.0300 from 1.0349, 125.20 yen from 125.76, 0.6410 pounds from 0.6450 and 1.5875 Swiss francs from 1.5915.
The dollar was at 121.63 yen (121.52), 1.5410 Swiss francs (1.5384).
Sterling was trading at $1.6080 (1.6047), 195.57 yen (195.05) and 2.4777 Swiss francs (2.4687).