Asian currencies lower late, rupiah dragged lower by peso
Asian currencies lower late, rupiah dragged lower by peso
TOKYO (Dow Jones): Reeling from deepening political turmoil in the Philippines, the peso tumbled to a new record low Thursday as the central bank there made a few noises but offered no support for the battered currency.
The peso's weakness undermined sentiment across the region, helping to drag the Indonesian rupiah and Thai baht lower. But with markets in Singapore closed for the Deepavali holiday, trading volumes in southeast Asian currencies were generally low, dealers said.
The Indonesian rupiah ended Asian trade Thursday at its lowest closing level since July, pulled by the decline in peso amid thin trade, dealers said.
The dollar closed at Rp 9,010, up from Rp 8,950 late Tuesday. The onshore market was closed Wednesday for a national public holiday.
A day after the Philippine vice president suggested that the only solution to the nation's confidence crisis would be for President Joseph Estrada to resign, speculation grew that the central bank might be preparing to conduct its second sharp rate hike this month.
Late in the Asian day, the dollar was quoted at 50.70 pesos, up from 49.65 pesos a day earlier.
The peso has now lost nearly 20 percent of its value against the dollar since the beginning of the year.
Traders bearish on the peso were willing to press their luck Thursday after Rafael Buenaventura, the governor of the Philippine central bank, confirmed that authorities weren't intervening. Buenaventura pinned the blame for the peso's decline on political scandals shaking the country. He added that monetary policy shouldn't be used to solve problems that are out of the realm of the central bank.
The peso's woes took their toll on other regional currencies, analysts said.
The Thai baht also got a dose of the peso blues Thursday. But dollar resistance at 44.00 baht held firm, limiting the dollar's high at 43.92 baht. Late in the day, the dollar was at 43.90 baht, up from 43.725 baht late Wednesday.
A day earlier, the dollar touched a 28-month high of 44 baht before the baht rebounded smartly. In comments Thursday, a Bank of Thailand official declined to comment on the forces that supported the local currency the previous day.
"I don't know why the baht strengthened, but we'll keep watching the market closely," said Assistant Governor Chetthavee Charoenpitaks.
Brice said it's just a matter of time - within a month - before the dollar beaches 44.00 baht convincingly en route toward a test of 46.00 baht.
In Seoul, the South Korean won suffered as stock prices headed south. The dollar ended Thursday at 1,137.40 won, up slightly from 1,137.10 won a day earlier. Traders said talk that Ssangyong Cement Co. might sell $350 million in the market before the end of the month tempered the dollar's upside.
The benchmark Korea Composite Stock Price Index ended Thursday at 523.67, down 18.66 points, or 3.4 percent.
In Taipei, the New Taiwan dollar also lost ground against the U.S. dollar amid weakness in the local stock prices. The dollar ended the session at NT$32.096 Thursday, up from NT$32.072 at the previous day's close.
The Weighted Price Index of the Taiwan Stock Exchange closed 81.93 points, or 1.4 percent, lower at 5941.85.