Asian currencies mixed in late trade, rupiah retreats
Asian currencies mixed in late trade, rupiah retreats
SINGAPORE (Dow Jones): Asian currencies turned in a mixed performance Friday, splitting generally along a north-south divide.
To the north, the South Korean won and New Taiwan dollar had another rough session, both falling to close to two-year lows as a result of slumping stock prices and ongoing concerns about slower economic growth.
In Southeast Asia the Singapore dollar, Thai baht and Philippine peso all strengthened modestly, while the Indonesian rupiah edged lower.
The Indonesian rupiah closed lower against the U.S. dollar after some local banks snapped up the dollar amid thin trading volume.
The dollar closed at Rp 9,365 in Asia, up from Rp 9,270 late Thursday. The U.S. unit touched an intraday high of Rp 9,380 during the day.
Dealers said two local banks, namely Bank Bali (P.BBL) and Bank Central Asia (P.PCA), actively bought the dollar and pushed the U.S. currency higher.
"Those two banks were scrambling to buy the dollar as today was the last chance for buying the dollar," said a dealer with a foreign bank.
The north-south split that has emerged recently represents a turnaround from earlier in the year when the North Asian currencies dominated regional foreign exchange markets. The won and the New Taiwan dollar had surged to post-crisis highs this spring after market players concluded that those economies were best positioned to take advantage of the global Internet boom.
But as U.S. economic growth has slowed - curbing the country's hearty appetite for computer chips and other electronic equipment - South Korea and Taiwan's technology-rich markets have faltered.
And the resulting slowdown in foreign capital inflows has taken its toll on the local currencies.
The dollar closed at 1,237 won, up from 1,227.90 won at the previous close and its strongest performance in more than 21 months. The won has lost 2.5 percent of its value this week and 8 percent since the start of the year.
Against the New Taiwan dollar, the U.S. currency closed at a 22-month high of NT$33.180, up from NT$33.172 Thursday.
The Singapore dollar continued its rally, hitting a 15-week high against the U.S. dollar.
Market participants liquidated long U.S. dollar positions against the Singapore currency in response to recent U.S. dollar slippage against the euro, Australian dollar and New Zealand dollar, said Peter Redward, currency strategist at Deutsche Bank in Singapore.
"People are unwinding their long dollar positions and the Singapore currency is seen as a safe haven because of the strong economic fundamentals and large current account surplus," Redward said.
Late in Asian trading the U.S. dollar was quoted at S$1.7275, down from S$1.7295 late Thursday. Dealers said the market was reluctant to push the U.S. dollar much lower following suspected intervention by the Monetary Authority of Singapore Thursday to cap the Singapore dollar's appreciation at the S$1.7270 level.
The Thai baht continued to gain ground on the U.S. dollar, buoyed by falling oil prices, a more stable stock market and in anticipation of a narrowing interest rate differential between Thailand and the U.S.
Late in Asia the dollar was quoted at 41.195 baht, down from 42.365 baht late Thursday. It was the baht's best performance against the dollar since Oct. 2.
The Philippine peso was supported by what may be the last tranche of remittance inflows from overseas workers in the run-up to Christmas, traders said.
The dollar closed at its intraday low of 49.900 pesos on the Philippine Dealing System, down from 50.045 pesos Thursday. The dollar hit an intraday high of 50.105 pesos and averaged 50.024 pesos.