Asian currencies mixed, yen rally helps some

Asian currencies mixed, yen rally helps some

Alan Yonan Jr., Dow Jones, Singapore

Asian currencies were mixed against the dollar Wednesday, with
the South Korean won and New Taiwan dollar strengthening on the
back of gains in local stock markets and a late session yen
rally.

The Singapore dollar and Indonesian rupiah also advanced,
while the Philippine peso and Thai baht lost ground against the
U.S. currency.

The dollar, which has dominated currency markets regionally
and globally during the past two days began showing signs of
fatigue in the afternoon session against both the yen and euro.

The dollar opened the Asian trading day stronger against the
yen on the heels of better-than-expected U.S. retail sales data
for April and a strong performance in U.S. stock markets. The
Nasdaq Composite Index rose 4.0 percent, while the Dow Jones
Industrial Average advanced 1.9 percent.

But a follow-up rally on the Tokyo Stock Exchange, as well as
news that Japan's current account surplus increased by 52 percent
in March from a year earlier, gave investors reason to buy back
the yen.

The dollar fell to an intraday low of 128.00 yen after trading
as high as 128.60 yen. Near the end of Asian trading the dollar
was quoted at 128.15 yen, down from 128.50 yen late Tuesday in
New York.

The South Korean won appeared headed for a weaker finish until
the late yen rally triggered a round of won buying. Within the
last hour of trading the dollar fell from its intraday high of
1,280.1 won to 1,277.5 won at the close, down from 1,279.3 won
late Tuesday.

The won also got some help from dollar selling by exporters
and net foreign purchases of shares in the local stock market.

The main index of the Korea Stock exchange rose 3.0 percent,
with foreigners buying a net 257.5 billion won worth of shares.

Foreign equity inflows generated buying interest in the New
Taiwan dollar.

The U.S. dollar ended at NT$34.568, down from Tuesday's
NT$34.579.The New Taiwan dollar initially slipped after an
earthquake measuring 6.2 on the Richter scale struck Taipei, but
the currency quickly recovered when it was learned that no major
damage had been caused.

Foreign investors were net buyers of NT$7.1 billion in local
shares during the session, spurring the index to rally 2.7
percent and close at its highest level so far in May.

Strength in the yen also boosted sentiment toward the local
currency, dealers said.

The Singapore dollar strengthened slightly late Wednesday,
after hovering ina tight band. Late in Asia the U.S. dollar was
quoted at S$1.8062, down from S$1.8070 late Tuesday.

The U.S. dollar was stuck between S$1.8075-S$1.8085 throughout
most of the day, but came under mild selling pressure when it
began to fall against the yen near the end of the session.

The Philippine peso weakened amid corporate demand for the
U.S. currency. The dollar closed at 49.650 pesos on the
Philippine Dealing System, up from 49.600 pesos Tuesday.

The government's higher-than-targeted budget deficit for the
first quarter, announced during the session, had a mild negative
effect on the peso, dealers said.

The government reported that its budget deficit in the first
quarter totaled 61.2 billion pesos, about 15 percent over the
52.9 billion pesos target.

The Indonesian rupiah was largely unaffected by lower-than-
expected economic growth figures for the first-quarter.

Near the end of Asian trading the dollar was quoted at Rp
9,255 rupiah, down from Rp,270 late Tuesday.

The government reported that gross domestic product grew 2.47
percent in the first quarter from a year earlier, below
economists' expectations of 3.5 percent growth.

Against the baht, the dollar was quoted at 42.900 bath late in
Asia, up from 42.885 bath a day earlier. Corporate supply and
demand for dollars against the local currency was relatively
balanced, as was speculative trade, dealers said.