Asian currencies mixed late, renewed weakness in won
Asian currencies mixed late, renewed weakness in won
SINGAPORE (Dow Jones): Asian currencies were mixed late Monday, with the South Korean won and the New Taiwan dollar feeling the brunt of a selloff on their respective local bourses, dealers said.
In Southeast Asian markets, the Thai baht and the Singapore dollar were stronger, while the Indonesian rupiah and the Philippine peso were weaker.
Despite the market's nervousness about further social unrest in Jakarta - following a 12 percent fuel price hike over the weekend and public outrage over a court's decision last week to dismiss the corruption trial of former President Soeharto - the rupiah's losses were limited Monday
Still, the dollar managed to regain its ground, as it edged up to Rp 8,800, from Rp 8,775 late Friday.
There was some dollar-buying by corporates at Rp 8,775 to service debt and for import needs, although demand wasn't strong.
The market also ignored the handing down of the draft 2001 budget, with almost all figures revealed already previously announced.
Dealers expect a range of Rp 8,750 to Rp 8,850 Tuesday. rupiah's losses were limited Monday.
A credit ratings upgrade, which came at the higher end of expectations, provided some respite for the rupiah, but only temporarily.
Standard & Poor's Corp. Monday raised its long-term and short- term foreign currency ratings on Indonesia to single-B-minus and C, respectively, after the London Club agreed to restructure $340 million in debt last week. S&P had previously assigned selective default ratings on both the long and short-term ratings.
"It's a long way off to investment grade, but it's still positive to sentiment that you get a double-notch upgrade," said Mansoor Mohi-uddin, regional currency strategist at UBS Warburg.
The South Korean won succumbed to renewed pressure as the local bourse plummeted by almost 4 percent, following steep losses on Wall Street last Friday, and on dollar-buying by offshore participants in the non-deliverable forward market.
Fresh doubts about South Korea's efforts to sell its distressed assets, an important part of the government's economic recovery program, had also cast a shadow on the won, dealers said.
The dollar finished at 1,118 won, up from Friday's close of 1,115 won.
The dollar is set to trade between 1,115 won and 1,125 won for the rest of the week, Oh said, adding, however, that he doubted the dollar could head toward 1,125 won this week, unless there are "fresh bad factors."
After earlier yielding to the pressure from the Taipei bourse, which sank 2.6 percent to a near 20-month low, intervention by the local central bank helped the New Taiwan dollar recoup its losses, dealers said.
The U.S. dollar finished at NT$31.314, little changed from Saturday's close of NT$31.316. The U.S. dollar had hit an intraday high of NT$31.326.
In Southeast Asia, hopes for a short-term rally in the Thai currency were dashed again, after the dollar failed to be suppressed below the 42 baht support level amid renewed political jitters. The dollar had briefly crossed below the 42 baht level mark several times last week.
Around 0905 GMT, the dollar was at 42.175 baht, still below 42.220 baht late Friday. Dollar long-liquidation earlier in the day had pushed the dollar below 42 baht psychological support, dealers said.
Against the Singapore dollar, which largely mirrored the baht's movements, the U.S. currency slipped to S$1.7397, from S$1.7417 late Friday.
On the Philippine Dealing System, the dollar was at 46.280 pesos, up from 46.150 pesos Friday.