Asian currencies mixed late, rupiah up
Asian currencies mixed late, rupiah up
Dow Jones, Singapore
Asian currencies were mixed against the dollar Monday, with weakness in the yen pulling the South Korean won and New Taiwan dollar lower.
The Thai baht also slipped against the dollar, while the Philippine peso, Singapore dollar and Indonesian rupiah strengthened modestly.
A campaign by Japanese officials to keep the yen from strengthening too rapidly against the dollar appears to be paying off, at least in the near term.
The willingness shown by Japan's Ministry of Finance to intervene in the currency markets in recent weeks helped keep the dollar decisively above the 124 yen level.
The dollar traded as high as 124.93 yen during Asian hours, and finished the day at around 124.70 yen, up from 124.34 yen late Friday in New York.
"Further intervention successfully put a floor under dollar/yen and should be seen as a reflection of the Japanese authorities' determination to address yen strength," Bank of America currency strategist Marshall Gitler said in a research report.
"However, dollar sentiment remains bearish and we still expect a crack of 120 yen even if the move down is only slow," he added.
The won, which hit an 18-month high last week, tumbled for the third straight session.
In addition to spillover weakness from the yen, the won was also hit by dollar purchases by a state-run bank.
The dollar finished at 1,230.5 won, up from 1,227.2 won at Friday's close.
Traders speculated the Korea Development Bank may have been acting on behalf of the central bank when it purchased dollars against the won. South Korean government officials have repeatedly expressed concerns in recent weeks that the strength of the won may hamper the country's economic recovery. Minister of Finance and Economy Jeon Yun-churl reiterated over the weekend that the government stands ready to take action to halt the won's rise, but he provided no other details.
The dollar traded in a narrow range of 1,229 won to 1,231 won, partly reflecting the fact that many market players were focused on the World Cup soccer match between South Korea and the U.S., dealers said.
Sentiment toward the rupiah perked up after the London Club group of private creditors agreed to reschedule Indonesian debt worth a total US$1.3 billion. The move could lead Standard & Poor's Corp. to lift its selective default rating on the country.
Near the end of trading the dollar was quoted at Rp 8,740, down from Rp 8,880 at Friday's close.
The dollar jumped to an intraday high of Rp 8,920 in the morning session after two bombs in Jakarta over the weekend left four people injured.
But dollar selling by state banks pulled the U.S. currency's off its highs. News of the London Club rescheduling pushed the dollar down even further to close at its intraday low.
The government's official announcement Monday that it was canceling the auction of its 51 percent stake in Bank Niaga was widely expected and did not affect rupiah trading, dealers said.
The Singapore dollar was a touch stronger in lackluster trade.
Late in Asia the U.S. dollar was quoted at S$1.7935, compared with S$1.7940 late Friday.
Dealers said volume was rather light and most trades were done via brokers with very few interbank calls being made.
The peso overcame some negative economic news to close higher amid thin demand for U.S. dollars.
The government reported Monday that nonperforming loans in the country's banking sector remained at a stubbornly high ratio of 18.23 percent in April, up from 18.0 percent in March.
The peso also showed little reaction to Friday's clash between government soldiers and rebel forces in the southern Philippines that left two hostages dead.
The dollar closed at 50.560 pesos on the Philippine Dealing System, down from 50.630 pesos Friday.
The New Taiwan dollar tracked the yen lower. The U.S. dollar closed at NT$34.164, compared with the previous close of NT$34.159.
The central bank, which regularly intervenes in currency markets to prevent the New Taiwan dollar from appreciating too rapidly, was relatively inactive Monday because of the subdued nature of trading, dealers said.
The baht also got caught in the yen's downdraft. Late in Asian trading the dollar was quoted at 42.425 baht, up from 42.330 baht late Friday.