Asian currencies mixed; equity inflows boost won

Asian currencies mixed; equity inflows boost won

SINGAPORE (Dow Jones): Asian currencies were mixed late Wednesday, largely in rangebound trade, with the dollar failing to make much headway as markets braced for more dismal economic data out of the U.S., dealers said.

The steep falls in U.S. June consumer confidence and July Chicago Purchasing Manager's Index unveiled Tuesday have prompted some observers to lower their projections on the National Association of Purchasing Managers' number for July, due to be issued at 1400 GMT (9 p.m. Jakarta time) Wednesday.

The NAPM index was originally expected to have fallen to 44.5 in July from 44.7 in June.

Nervousness ahead of the NAPM data pressured the dollar against the yen, in turn providing a mild reprieve for some of the other Asian currencies, in particular the South Korean won, the New Taiwan dollar and to a lesser extent, the Singapore dollar, which had recovered from its morning low, dealers said.

At 0823 GMT, the dollar was quoted at 124.76 yen, below 125.08 yen late Tuesday in New York.

The Indonesian rupiah ended lower on concern that President Megawati Sukarnoputri has failed to name a cabinet over a week after being elected.

"It's taking too long to chose the cabinet. The market's nervous," said a trader at a Jakarta-based foreign bank.

These dollar finished Wednesday's Asian day at Rp 9,600, up from Rp 9,525 at Tuesday's close.

Megawati's complete silence over policy since coming to power a week ago is beginning to hurt sentiment, traders said.

The market is nervous that Megawati's failure to quickly appoint a new cabinet could be due to political bickering over posts among the loose coalition - including the former ruling Golkar Party and the army - that elected her to power last week.

The South Korean won was the biggest gainer in Asia as massive foreign equity fund inflows overwhelmed the market's doubts of an anticipated economic recovery this year, dealers said.

The dollar closed at 1,296.5 won, lower than 1,300 won Tuesday.

The benchmark index on the Seoul stock market surged 3.9 percent as foreign investors bought a net 237.1 billion won in shares.

South Korean markets shrugged off poor inflation and trade data which underscored the country's deteriorating economic environment.

The New Taiwan dollar too received a fillip from foreign equity fund inflows, as foreign institutional investors bought a net NT$6.36 billion worth of shares on the Taipei bourse Wednesday.

The U.S. dollar closed at NT$34.730, down from NT$35.759 Tuesday, with Taiwan's central bank buying and selling the U.S. currency to smooth volatility in the foreign exchange market, dealers said.

Also supporting the New Taiwan dollar were U.S. dollar sales by local exporters needing to meet monthly payroll expenses, dealers said.

The Singapore dollar was weaker at S$1.8038 to its U.S. counterpart, compared with S$1.8026 late Tuesday. But the Singapore dollar was off its morning low of around S$1.8060, as the yen's gains helped recoup part of its early losses.

On the Philippine Dealing System, the dollar closed at 53.770 pesos, up from 53.540 pesos Tuesday as some banks covered their short-dollar positions, dealers said. Fears of tighter foreign exchange trading curbs had prompted these banks to sell their dollar positions Monday.

The peso could, however, find some temporary reprieve in the near-term from the Philippine commercial banks' agreement late Wednesday to help stabilize the ailing currency by boosting the supply of U.S. dollars in Manila's foreign exchange market.

The Thai currency was marginally weaker at 45.720 baht per dollar, compared with 45.715 baht late Tuesday.