Asian currencies mixed on Tuesday
Asian currencies mixed on Tuesday
Dow Jones, Singapore
Most Asian currencies were little changed in an uninspired trading session Tuesday as market players waited to see how the dollar and yen will react to key pieces of economic information coming out of the U.S. and Japan this week.
The Singapore dollar, New Taiwan dollar and Indonesian rupiah were also little changed. The South Korean won slipped, while the Philippine peso strengthened slightly. Markets in Thailand were closed for a public holiday.
"Despite attempts on the upside and downside of the range, foreign exchange markets are still caught in ranges, reluctant to budge as the forces driving Asian currencies stronger and weaker remain finely balanced," BNP Paribas said in a note to clients.
The dollar/yen exchange rate, which often sets the tone for trading in other Asian currencies, was trapped in a relatively narrow band throughout the session and provided little guidance.
The market is also focusing on Federal Reserve Board Chairman Alan Greenspan's congressional testimony Wednesday on the state of the U.S. economy.
Late in Asian trading, the dollar was quoted at 133.83 yen, compared with 133.80 yen late Monday in New York and 133.86 yen late Monday in Tokyo.
Concerns that the Koizumi administration's anti-deflation package may not produce the desired results, along with the expiration of dollar/yen option barriers Wednesday, could trigger renewed yen weakness that could flow through to other Asian currencies, BNP Paribas added.
On the other side of the Pacific Ocean, analysts said the dollar could benefit from any hints that Greenspan may give on prospects for a U.S. economic recovery.
The New Taiwan dollar found little room to maneuver between opposing market forces. Month-end U.S. dollar selling by exporters helped the local currency, while net sales of stocks by foreigners hurt it.
The U.S. dollar closed at NT$35.088, compared with NT$35.090 at the previous close.
The Singapore dollar tracked the yen's narrow trading range.
Late in Asian trading, the U.S. dollar was quoted at S$1.8313, down marginally from S$1.8318 late Monday. It traded between S$1.8306 and S$1.8325.
Against the Indonesian rupiah, the dollar finished Asian trading unchanged at Rp 10,175.
Market players are waiting to see who the government will choose as the winning bidder for a 51 percent stake in PT Bank Central Asia.
Debt restructuring talks under the Paris Club of creditors in April depend on a successful sale of the bank and failure to announce a winner this week could hurt the rupiah, analysts said.
Late Tuesday, Indonesia's Bank Restructuring Agency said it would need at least two weeks to choose a winner for a controlling stake in Bank Central Asia, signaling yet another delay in the long-awaited sale.
The peso was supported by a decline in corporate demand for dollars and expected investment inflows, traders said.
The dollar closed at 51.315 peso on the Philippine Dealing System from Friday's 51.368 peso.
Manila's financial markets were closed Monday for a national holiday.
The South Korean won weakened as foreigners bought dollars to settle their recent stock sales.
The dollar finished at a four-week high of 1,325.4 won, up from Monday's close of 1,323.90 won.
The steady yen helped keep the dollar hemmed in between 1,322.5 won and 1,324.9 won.