Asian currencies mostly down late, peso remains vulnerable
Asian currencies mostly down late, peso remains vulnerable
SINGAPORE (Dow Jones): Renewed weakness in the Japanese yen,
the turmoil in the Philippines and confusion surrounding
Indonesia's latest foreign exchange regulations cast a shadow on
most Asian currencies late Thursday, dealers said.
The New Taiwan dollar, the only gainer in Asia, resisted the
pressure from the yen late in the day as foreign equity funds
poured into the local bourse, dealers said.
In contrast, the South Korean won, the Singapore dollar and
the Thai baht remained victims of the dollar's strength against
the Japanese yen. Incoming U.S. Treasury Secretary Paul O'Neill's
unequivocal support for a strong dollar policy allayed fears that
the Bush Administration will soften the country's stance.
After hitting a new 18-month high of 119.90 yen in early
trading, the dollar was quoted at 119.04 yen late Thursday, up
from 118.83 yen late Wednesday in New York. The dollar was at
117.07 yen late Wednesday in Tokyo.
The Indonesian rupiah closed lower in thin trading Thursday on
dollar purchases by local companies and state banks, dealers
said.
The dollar closed at Rp 9,470, up from Rp 9,400 late
Wednesday. The currency pair traded in a narrow range Thursday.
Local companies and some state banks bought the dollar to pay
maturing offshore debts. However, the dollar was well capped near
Rp 9,490 on dollar selloffs by state banks, which were believed
to have acted on the behalf of Bank Indonesia, dealers said.
Trading among banks in Singapore came to a standstill as banks
were reluctant to trade in the currency on fears they may be
caught short on the rupiah, after Bank Indonesia Monday tightened
rules on foreign exchange trading.
Trading volume between banks in Singapore and their Jakarta
counterparts was thin, dealers said.
In Manila, President Joseph Estrada's virtual acquittal in his
impeachment trial - amid uncertainty on whether the trial will
ever resume - and intensifying rumors of an impending uprising or
military coup ousting the embattled leader continued to hurt the
peso. But the pace of the peso's decline was relatively more
restrained, as Wednesday's panic selling was toned down.
The dollar finished at 54.790 pesos, down from its intraday
high of 55.250 pesos, but remained higher than Wednesday's close
of 54.625 pesos.
The other regional currencies were largely taking the cue from
the yen's movements.
Even the Thai baht, which was once used by offshore
participants as a proxy for the peso, paid scant attention to the
Philippine currency, dealers said.
After trading in a narrow range, the Thai currency weakened to
43.330 baht against the dollar, compared with 43.125 baht late
Wednesday.
The Singapore dollar floundered, as currency watchers
questioned the appropriateness of the authority's tightening
policy following Wednesday's weak trade data and with the U.S.
economic slowdown, dealers said. The city-state's non-oil
domestic exports in December shrank 4.9 percent compared with a
year earlier, shocking economists who were expecting low single-
digit growth.
Against the Singapore dollar, the U.S. currency was at
S$1.7379, up from S$1.7334 late Wednesday.
In North Asia, the won succumbed to the yen's weakness, while
the New Taiwan dollar ended at a fresh eight-week high, as
foreign fund equity inflows countered the pressure from the
Japanese currency. Japan, South Korea and Taiwan need to keep
their currencies competitive since they compete in similar export
markets.
The dollar finished at 1,284.0 won, higher than Wednesday's
close of 1,277.6 won.
Against the New Taiwan dollar, the U.S. dollar ended lower at
NT$32.616, down from the previous close of NT$32.631, and way
below the intraday high of NT$32.680.