Asian currencies mixed; Japan, U.S. holidays mute activity

Asian currencies mixed; Japan, U.S. holidays mute activity

SINGAPORE (Dow Jones): Asian currencies were mixed in thin
trading late Monday as holidays in Japan and the U.S. muted
market activity.

Traders said they had expected a relatively quiet session and
got one, given the absence of any fresh news to move the markets.

Even the recently volatile Indonesian rupiah remained
relatively quiet ahead of some key political decisions being made
this week.

Indonesian President B.J. Habibie is expected to decide this
week whether to order the prosecution of former President
Soeharto. The country's top legal officer, Ismudjoko, recommended
Monday that the corruption case against the ex-president be
dropped due to lack of evidence. His comments had little effect
on the rupiah.

Leaders of the ruling Golkar Party start debating Tuesday
whether to keep or dump Habibie as its candidate for the
presidential election Oct. 20.

At 0800 GMT (4:00 a.m. EDT), the U.S. dollar was trading at
7,810 rupiah, just up from Rp 7,760 in late Asian trading Friday.
The U.S. dollar was also trading at 40.045 Thai baht, up from
40.015 baht late Friday. Traders said the U.S. dollar, which
started the session drifting higher, was sold off at just under
40.50 baht.

Traders and currency strategists remain mixed over the
fortunes of the Thai baht. Year-end pressures such as profit-
taking and even concern the country will be hit by Y2K computer
bug-related problems are being offset by expectations that
Moody's Investor Services may issue a sovereign upgrade in coming
weeks.

While a Moody's upgrade may seem justifiable, local sources
strongly reject the idea," said the Hong Kong-based Bank of
America's currency strategy group in its daily market comment.

"On the plus side, improved extended liquidity and much
stronger macro numbers since the downgrade have created the
expectation of an upgrade."

However, the strategists at Bank of America said Moody's might
delay any upgrade until the new year.

"Increased political uncertainty (with an election possible in
the first quarter) and Y2K issues represent new impediments," the
bank group said. "Most importantly, banking system restructuring
is behind schedule and, with nonperforming loans barely off their
peaks, it may be hard to justify an upgrade."

Against the Singapore dollar, the U.S. dollar was trading at
S$1.6772, down from S$1.6796 in late Asian trading Friday.

"The Singapore dollar has traded in an extremely tight range,
consistent with the absence of news from the Singapore markets,"
the Bank of America strategists said. "Weak regional tone and
fear of authorities (intervening in the market) have combined to
thwart Singapore dollar's upside."

On the Philippine dealing system, the U.S. dollar was trading
at 40.255 pesos, just down from 40.465 pesos late Friday.

Against the South Korean won, the U.S. dollar was trading at
1204.2 won, up from 201.2 won in late Asian trading Friday. In
Taiwan, the U.S. dollar was at NT$31.765, just down from
NT$31.775 Friday.