Asian currencies mostly down; central bank fears ease pain

Asian currencies mostly down; central bank fears ease pain

SINGAPORE (Dow Jones): Most Asian currencies suffered a relapse late Thursday as the Japanese yen's recent reprieve proved to be short-lived, dealers said.

But talk of central bank intervention kept a rein on some of the currencies' losses, in particular the Singapore dollar and the New Taiwan dollar, dealers said.

The Indonesian rupiah ended a touch lower in thin volume trading as players wait to see whether President Abdurrahman Wahid will resign in the coming months.

Players are unwilling to take large positions given the political uncertainty, which is keeping the dollar in a very narrow range against the rupiah.

The dollar closed at Rp 11,345, higher than its close of Rp 11,325 Wednesday.

The Thai baht remained detached from the region's developments, as market participants continued to bail out of their long dollar positions, dealers said.

"No matter what's happening in the world, the baht is strengthening," said Mansoor Mohi-uddin, a foreign exchange strategist at UBS Warburg. However, he added that the currency will likely resume its recent downtrend in the medium term on "sustained capital outflows."

Concerns over the Thai central bank's plan to introduce stricter foreign exchange disclosure requirements for nonresident baht accounts kept offshore participants circumspect about trading the currency.

The dollar was quoted at 45.185 baht, lower than 45.215 baht late Wednesday.

The Singapore dollar slumped to its lowest level since May 10, before U.S. dollar sales by a local bank fueled talk that the monetary authority may have intervened in early trade, dealers said.

The Singapore dollar had skidded to as low as S$1.8238 against its U.S. counterpart at the open, as the yen floundered toward Y124 to the U.S. currency, dealers said. Late Wednesday, the U.S. dollar was quoted at S$1.8177.

Though some dealers doubted that the Monetary Authority of Singapore had intervened through its agent bank, fears of testing the central bank's resolve kept the local dollar off its low for the rest of the day.

At 0830 GMT (3:30 p.m Jakarta time), the U.S. dollar was quoted at S$1.8209, higher than S$1.8177 late Wednesday.

The double whammy of a weaker yen and a decline on the Taipei bourse sent the New Taiwan dollar reeling toward the critical NT$34.500 mark against the U.S. currency, dealers said.

The U.S. dollar closed at NT$34.456, up from NT$34.400 Wednesday. Dealings were valued at US$817.5 million, up from US$313 million Wednesday.

Taiwan's benchmark stock index slipped 0.9 percent to close below the 5000-point psychological support level at 4984.88 on nagging worries over the technology sector.

The yen's pullback also dealt a blow to the South Korean currency, which ended at 1,302.9 won against the dollar, compared with 1,294.9 won Wednesday.

The slump in regional foreign exchange markets and corporate dollar demand dented the Philippine peso, dealers said.

The peso shrugged off the central bank's decision to leave its overnight interest rates unchanged at Thursday's weekly meeting of its policy-making board. The central bank cited concerns over the weak peso for keeping policy on a neutral bias. The headline overnight borrowing rate is 9 percent

The dollar closed at 52.200 pesos, up from 52.010 pesos Wednesday.