Asian currencies finish mixed
Asian currencies finish mixed
SINGAPORE (Dow Jones): Asian currencies were mixed late
Friday, with the South Korean won battered by renewed concerns
over the extent of the economy's dependence on the country's
chaebols, dealers said.
News of the financial woes of the Hyundai Group, the country's
leading conglomerate, rattled Seoul financial markets.
The dollar finished at 1,136.50 won, up from Thursday's close
of 1,129.90 won.
The benchmark stock index on the Korea Stock Exchange plunged
6.1 percent to 656.66 Friday, its lowest level since April 17,
1999.
Korea Exchange Bank said early Friday it was extending an
emergency 50 billion won loan to Hyundai Group. The conglomerate
said it would provide some of the funds to Hyundai Engineering &
Construction Co., South Korea's largest construction company.
Investors fear the Hyundai Group's financial problems may be
worse than expected, despite assurances from its major creditor
bank and the government the liquidity problem at Hyundai
Engineering & Construction was temporary and that Hyundai Group's
other units don't have liquidity problems.
In the Philippines, the floundering currency found some
respite against the dollar from the prospect of peace talks with
Muslim separatists in Mindanao and liquidation of long-dollar
positions by banks, as demand for the U.S. currency dwindles.
The dollar closed at 42.720 pesos on the Philippine Dealing
System, down from 43.400 pesos.
Social unrest in Jakarta prompted offshore players to bail out
of the Indonesian rupiah.
Students set police and military vehicles on fire near the
home of ex-President Suharto, following repeated protests this
week urging the government to arrest and try Suharto for
corruption.
The dollar was at Rp 8,503 late Friday, up from Rp 8,450 late
Thursday, after peaking at Rp 8,565 midday on reports of the
unrest.
Further anti-Suharto protests are expected over the weekend
and may put the rupiah under more pressure Monday, traders said.
Corporate dollar demand remains strong, keeping the U.S. unit
well bid above Rp 8,400, they added.
Looking further ahead, the dollar could strengthen to Rp 9,000
in the coming month, "assuming the dollar doesn't collapse across
the board overnight," said Standard Chartered Bank Treasury
Economist Philip Wee.
"As long as it stays above Rp 8,200, we're still bullish on
the dollar versus the rupiah," Wee added.
Elsewhere, the New Taiwan dollar closed higher as a 1.4
percent rally in the local stock market eased the downward
pressure on the local currency, dealers said.
The U.S. dollar finished lower at NT$30.808, from Thursday's
close of NT$30.813.
Against the Thai currency, the dollar was at 39.070 baht,
barely changed from 39.075 baht late Thursday.
Most Asian currencies will likely continue to trade within
their recent range, with the U.S. stock market expected to
dictate their direction next week, as it had over the past week,
analysts said.
The Philippine, Indonesian and Thai currencies will continue
to be "the most vulnerable to any increase in risk aversion on
the part of investors" as capital inflows into these countries
are the weakest, Low at Merrill Lynch said.