Asian currencies mixed late, rupiah gyrates on news
Asian currencies mixed late, rupiah gyrates on news
SINGAPORE (Dow Jones): Asian currencies late Monday are mixed
amid talk of a Cabinet reshuffle in Indonesia, and news that
Jakarta is catching up on an economic reform program set out by
the International Monetary Fund.
News that Indonesian President Abdurrahman Wahid expects three
members of his cabinet to resign - at least temporarily - while
they face corruption charges, and speculation that this could
trigger a shakeup in the Cabinet pushed the Indonesian rupiah to
an early intraday low of Rp 7,700 against the U.S. dollar.
However, the weakness was short-lived as the currency
rebounded after the IMF said it would support Indonesia's request
to restructure $2.1 billion in sovereign debt at a Paris Club
meeting April 12.
John Dodsworth, IMF country representative to Indonesia, told
Dow Jones Jakarta is catching up on the implementation of a slew
of economic reforms, such as bank recapitalization and private
debt restructuring.
Failure to meet a March 31 deadline for a number of these
reforms prompted the IMF to delay the disbursement of $400
million in loans. This cast a pall over the Paris Club meeting as
some donor countries were reluctant to allow Indonesia to
reschedule its debt unless it remained on track with the IMF.
But IMF backing for Indonesia at that meeting, and news it
will soon send a review team to the country suggest the IMF may
soon resume lending, which would boost investor sentiment and the
rupiah.
The dollar late in Asian trading was quoted against the rupiah
at Rp 7,660, barely changed from Rp 7,663 late Friday.
The currency of neighboring Singapore weakened on expectations
Singapore Telecommunications Ltd., or SingTel, will proceed with
a plan to buy a stake in Time Engineering Bhd. of Malaysia for
more than S$1 billion, or 2.2 billion ringgit.
Traders expect SingTel would need to sell Singapore dollars in
the spot market to finance what would be a cash transaction.
Both parties have set a one-month deadline to finalize the
proposed tie-up, which is subject to regulatory approvals, and is
conditional upon a due-diligence review of Time Engineering's
operations by SingTel.
The U.S. currency was quoted at S$1.7165, up from S$1.7125
late Friday.
Elsewhere, Thai Finance Minister Tarrin Nimmanahaeminda denied
rumors he was set to dismiss Central Bank Governor Chatu Mongol
Sonakul from office.
Despite the denial, tensions between the two remain high over
a new law that would merge three central bank reserve accounts.
With elections due by November, Tarrin wants to transfer
excess reserves to reduce debt and avoid unpopular tax hikes,
while Chatu Mongol says the new law would weaken the Bank of
Thailand's ability to manage monetary policy.
The U.S. dollar was at 38.000 baht from 37.985 baht a day
earlier.
In Taiwan, renewed attacks by China on Taiwan's vice
president-elect Annette Lu failed to dampen enthusiasm for Taiwan
stocks - the benchmark index rose 1.9 percent - or curb a sharp
rise in the New Taiwan dollar.
China described Monday Annette Lu as insane and accused her of
risking the island's safety by favoring independence, while the
official Xinhua News Agency referred to Lu on the weekend as the
"scum of the Chinese nation."
The New Taiwan dollar rose to its highest level since October
23, 1997. At the close, the U.S. currency was quoted at
NT$30.300, from NT$30.360 previously.
Meanwhile, the South Korean won ended lower on steady indirect
government intervention through the state-run Korea Development
Bank.
Authorities appeared determined to neutralize the potential
won-bullish impact of Monday's surprise announcement that North
and South Korea will meet June 12 to 14, said Oh Suk-tae, a
currency strategist for Citibank in Seoul.
The dollar finished at 1,109.40 won, up from Friday's close of
1,107.10 won.
In Manila, it ended at 41.100 pesos, down slightly from 41.105
pesos previously.