Asian currencies mostly down late; baht rally fizzles
Asian currencies mostly down late; baht rally fizzles
SINGAPORE (Dow Jones): Most Asian currencies fell under the
sway of the wavering Japanese yen and the Thai baht late
Wednesday, dealers said.
Resisting the pressure, the Indonesian rupiah was steady on
hopes that President Abdurrahman would eventually be forced to
step down, dealers said.
After falling to an intraday low of Rp 11,115, the dollar
closed at Rp 11,210, little changed from its close Tuesday.
Dealers said trading was quiet as most market participants
were waiting for further developments on the political front.
"The dollar will likely trade in a range until August," said a
dealer with a foreign bank.
Dealers expect the dollar to trade between Rp 11,100 and Rp
11,300 Thursday.
The Thai baht continued to take centerstage in choppy trading,
amid talk of central bank intervention and confusion over the
central bank's earlier plan to introduce foreign exchange
disclosure requirements for non-resident transactions from July
2.
The Thai currency started the Asian trading day on a firmer
footing, extending Tuesday's rally to hit an intraday high of
44.740 baht per dollar. Late Tuesday, the dollar was quoted at a
lower level of around 45.095 baht.
Offshore participants, especially U.S. banks, continued to
unwind their long dollar positions amid uncertainty over the
central bank's stringent disclosure rules, and fears that these
could be a precursor to capital controls.
Repeated reassurances by Thai officials ruling out the
possibility of capital controls failed to assuage the market.
"Nobody wants to be caught," said Philip Wee, a market
strategist at Singapore's DBS Bank.
At 1030 GMT (1:30 p.m. Jakarta time), the dollar was quoted at
45.255 baht.
The baht's retreat conspired with the faltering yen to drag
the Singapore dollar and the Philippine peso lower, dealers said.
At 1040 GMT (5.40 p.m. Jakarta time), the dollar was quoted at
Y120.79, above Y120.34 late Tuesday in New York and Y119.55 late
Tuesday in Tokyo.
The Singapore dollar weakened to S$1.8121 against its U.S.
counterpart, compared with S$1.8102 late Tuesday.
Fears of incurring the wrath of the Monetary Authority of
Singapore will likely prevent the local currency from falling
below S$1.8200, unless the yen slides to Y130, said DBS Bank's
Wee.
"Generally for the region as a whole, the authorities see
exchange rate volatility as a problem," he said. "They are all
looking to curb this right now, including Singapore."
Concerns that the hostage crisis in southern Philippines would
be prolonged dealt a further blow to the peso, dealers said.
The dollar closed at 50.720 pesos on the Philippine Dealing
System, up from 50.590 pesos Tuesday.
Market participants were closely monitoring clashes between
the military and the Muslim extremist rebels who were holding at
least 20 foreign and local hostages, dealers said.
Foreign equity fund inflows mitigated the pain inflicted by a
weaker yen on the New Taiwan dollar, dealers said.
The U.S. dollar ended at NT$34.065, compared with NT$34.043
Tuesday.
South Korean financial markets were closed Wednesday for a
national holiday and will reopen Thursday.