Asian currencies mostly down, S'pore dollar at mercy of M&A

Asian currencies mostly down, S'pore dollar at mercy of M&A

SINGAPORE (Dow Jones): Most Asian currencies drifted slightly
lower late Wednesday, but remained hemmed in within narrow
ranges, as they mirrored the yen's movements, dealers said.

Resisting the yen's pressure, however, the Singapore dollar
and the Thai baht were stronger.

The Indonesian rupiah ended lower Wednesday after the
country's army chief warned President Abdurrahman Wahid not to
dissolve Parliament as a way of preventing his impeachment.

Wahid has denied making a threat to dissolve Parliament last
weekend, as reported in the local press, but the rumors have
again helped destabilize the embattled rupiah.

The dollar closed at its day high of Rp 11,075 Wednesday, up
from Tuesday's close at Rp 10,950.

The Singapore dollar took center stage on renewed concerns
that Singapore Telecommunication Ltd.'s A$17 billion bid for
Australia's Cable & Wireless Optus might be scuttled.

A report by the Melbourne Age newspaper that the Australian
government will block SingTel's planned takeover of C&W Optus,
unless the U.S. grants export licenses for military satellite
technology, resurrected such fears.

The deal, which has contributed to the U.S. dollar's recent
strength against the Singapore currency, led to a sharp pullback
in the U.S. dollar to around S$1.8200 in early Asian trade.

Late Tuesday, the U.S. dollar was higher at S$1.8238.

Fears of intervention by the Monetary Authority of Singapore -
which dealers believed had intervened to smooth the local
dollar's decline last Friday and earlier this week - also kept
participants wary of pushing the Singapore dollar down too
aggressively.

A marginal rise in Malaysia's international reserves as of
April 30, and reassurance by a senior government official that
the government has no plans to review the ringgit peg for now
assuaged fears of an imminent devaluation of the currency. This
also contributed to the Singapore dollar's sharp rebound in early
trading, market watchers said.

The South Korean won and the New Taiwan dollar fell slightly
as the yen declined.

At 0940 GMT (4:40 p.m. Jakarta time), the dollar was quoted at
Y121.54, above Y121.30 late Tuesday in New York.

But dollar-sales by South Korean exporters kept a rein on the
won's losses, dealers said.

The dollar closed at 1,301.8 won, up slightly from 1,300.5 won
Tuesday, after trading within a narrow band of 1,301.0 won to
1304.9 won.

Foreign equity fund inflows, lured partly by hopes that some
Taiwan technology stocks will be included in the Morgan Stanley
Capital International Provisional Index Series, helped counter
the pressure from the yen, dealers said.

The U.S. dollar closed at NT$32.879, a shade higher than
Tuesday's close of NT$32.875.

Fears of political violence ahead of next Monday's
congressional and local elections dented the Philippine peso,
dealers said.

Dollar short-covering by banks, too, contributed to the peso's
decline. Earlier in the day, remittances of dollars from overseas
Filipino workers had propped up the peso, dealers said.

The dollar closed at 50.650 pesos on the Philippine Dealing
System, up from 50.460 pesos Tuesday.

The Thai currency strengthened to 45.490 baht per dollar, from
45.575 baht late Tuesday, as exporters unloaded the U.S. currency
and foreign funds flowed into the local bourse, dealers said.