Asian currencies mixed late, S'pore dollar extends rebound
Asian currencies mixed late, S'pore dollar extends rebound
SINGAPORE (Dow Jones): Asian currencies were mixed late
Wednesday, with the market on tenterhooks ahead of Federal
Reserve Board Chairman Alan Greenspan's Congressional testimony
later in the global day, dealers said.
Market participants are seeking clues on the U.S. economic and
policy outlook.
With few signs of an imminent economic recovery in the U.S. so
far, the outlook for Asian economies remain grim, and regional
currencies are expected to stay depressed in coming weeks,
analysts said.
The Indonesian rupiah closed higher Wednesday as the market took
heart from talk of a political compromise between embattled
President Abdurrahman Wahid and his political opponents.
Wahid appeared to back down from threats to impose a state of
emergency and dissolve Parliament.
State bank dollar selling also helped push the U.S. currency
to end at Rp 11,285, down from Rp 11,337 Tuesday.
Still, the rupiah's strength Wednesday was limited as
political tensions remain high ahead of the scheduled impeachment
next month.
The dollar is expected to trade in a Rp 11,250 to Rp 11,300
range Thursday.
Fears of testing the regional central banks' resolve had also
tamed dollar bulls, dealers said. Dealers believed most of the
region's monetary authorities had intervened in their respective
foreign exchange markets earlier this week, as their currencies
languished at multi-month, if not multi-year lows.
Indeed, suspected intervention by the local monetary authority
contributed to the Singapore dollar's gains, extending Tuesday's
rebound.
Speculation that the Monetary Authority of Singapore was
consistently selling the U.S. currency all day through a European
bank prompted participants to trim their long U.S. dollar
positions, dealers said. A local bank was also rumored to be
selling U.S. dollars on behalf of the MAS earlier in the day,
dealers said.
At 0855 GMT (5:55 p.m. Jakarta time), the U.S. dollar was
quoted at S$1.8317, below S$1.8341 late Tuesday.
The Philippine central bank was also believed to have staved
off the pressure on the local currency, helping it regain its
footing after having earlier in the day weakened past the 54-peso
mark to the dollar, dealers said.
In what may be the most aggressive intervention this year,
dealers estimated the central bank sold up to $80 million
Wednesday to pull the dollar below the key 54 pesos level.
The dollar closed at 53.700 pesos on the Philippine Dealing
System, down from 53.950 pesos Tuesday.
Similarly, the New Taiwan dollar recouped its earlier losses
as the central bank sold an estimated US$100 million at the last
minute to shore up the local currency, dealers said.
The U.S. dollar ended at NT$35.027, slightly lower than
Tuesday's close of NT$35.047. Trading volume totaled US$597
million.
Foreign equity fund outflows also dented the South Korean won,
although expectations of further foreign direct investment
inflows kept a rein on the currency's decline, dealers said.
The dollar finished at 1,311.7 won, marginally higher than
+Tuesday's close of 1,311.2 won.
Weighed by the peso's earlier decline, the Thai currency was
slightly weaker at 45.785 baht per dollar, compared with 45.755
baht late Tuesday.
Thai central bank Governor Pridiyathorn Devakula said
Wednesday he is monitoring the baht's movements to ensure that
there's no excess volatility, although he added that the
currency's movements aren't considered "too volatile" at the
moment.