Asian currencies mixed late, rupiah surges to 10-month high

Asian currencies mixed late, rupiah surges to 10-month high

SINGAPORE (Dow Jones): Asian currencies were mixed late
Thursday, as domestic factors mitigated the pressure from
declining stock markets across the region and concerns over a
protracted economic downturn, dealers said.

The Indonesian rupiah earlier surged to its strongest level
since October last year, on growing confidence that President
Megawati Soekarnoputri would unveil a market-friendly cabinet
Thursday. Although some profit-taking on the currency emerged
after the cabinet announcement.

The Philippine peso ended marginally firmer as the authorities
displayed a resolve to shore up the beleaguered currency.

The Thai baht was steady amid scant offshore trading, with
Singapore markets closed for the National Day celebrations.

The New Taiwan dollar and the South Korean won were weaker as
they succumbed to the selloff on their respective bourses,
dealers said.

The glum tone of the U.S. Federal Reserve's "Beige Book" and
the subsequent dive in stocks on Wall Street cast a shadow on
Asian equity markets.

The Indonesian rupiah posted its biggest gains just hours
before the long-awaited announcement of the country's cabinet.

Talk that Megawati would appoint market-friendly ministers
propelled the local currency to a 10-month high of Rp 9,050 per
dollar in early trade, dealers said. Late Wednesday, the dollar
was at Rp 9,325.

At 0900 GMT (4 p.m. Jakarta time), the dollar had recouped
part of its earlier losses to trade at Rp 9,125.

The Philippine central bank confirmed the market's fears when
it announced just minutes before the close of trading a two-
percentage point rise in banks' liquidity reserve requirement,
further providing the peso - which was already firmer throughout
the day - a marginal boost, dealers said.

The central bank's latest move - the second since July 27 - is
expected to drain some 27 billion pesos from the financial
system, neutralizing funds that could be used to speculate on the
peso market.

The dollar closed at 53.000 pesos, down from 53.150 pesos
Wednesday.

Foreign exchange participants paid scant attention to
President Gloria Macapagal Arroyo warning's Thursday that
currency controls may be imposed again to shield the peso from
speculative attack. Her comments were viewed merely as an attempt
to deter speculators.

The South Korean won wavered as foreign investors sold 109
billion won in shares on the local stock market, contributing to
the benchmark index's 2.9 percent slide. The currency ignored the
central bank's quarter-percentage point cut in the overnight call
rate Thursday, since it was within market expectations.

The dollar finished at 1,288.4 won, higher than Wednesday's
close of 1,285.0 won.

The New Taiwan dollar too yielded to a selloff on the local
bourse, amid persistent anxieties about the severity of the
island's economic malaise after exports in July plunged a
sharper-than-expected 28 percent from a year earlier, dealers
said.

The U.S. dollar ended at NT$34.662, higher than NT$34.648
Wednesday.

The Thai currency was little changed at 45.450 baht per
dollar, compared with 45.445 baht late Wednesday. Participants
reacted with indifference to yet another delay in the central
bank's announcement - which had been expected Wednesday - on the
changes to reporting rules for baht transactions by nonresidents.

The Singapore dollar was quoted in thin offshore trade at
S$1.7769 against its U.S. counterpart, slightly weaker compared
with S$1.7757 late Wednesday.