Asian currencies mostly up late on yen, central bank fears

Asian currencies mostly up late on yen, central bank fears

SINGAPORE (Dow Jones): The yen's rebound and Wall Street- inspired gains on many of the region's bourses lifted most Asian currencies late Thursday, dealers said.

Fears of a potential backlash from some of the central banks also continued to provide respite for currencies like the Singapore dollar and Thai baht, dealers said.

The Indonesian rupiah ended higher Thursday but its gains were fragile as the market waits to see whether President Abdurrahman Wahid will be able to strike a political compromise with his opponents.

The dollar closed at Rp 11,355 Thursday, down from than its close Wednesday at Rp 11,413.

The U.S. unit traded in a range of Rp 11,280 to Rp 11,350.

In early trade, the dollar moved lower as investors squared long positions in the U.S. currency.

Left out in the cold, the Philippine peso lost ground on increasing concerns about the final tally of Monday's elections and uncertainty over whether President Gloria Macapagal-Arroyo's candidates could retain their lead in the race for the 13 Senate seats as the votes are counted.

The Singapore dollar continued to outpace the rest of its regional peers, amid fears of testing the central bank's resolve after - in an extremely rare move - it confirmed Tuesday the market's suspicions that it intervened last week, dealers said.

The MAS also warned of further intervention to offset any currency weakness arising from strong demand for U.S. dollars by companies seeking to fund their overseas acquisitions, while reiterating its policy of allowing "a gradual, modest appreciation of the trade-weighted Singapore dollar."

"Nervous longs from offshore speculative funds are getting out," said a dealer at a European bank. "They're concerned about the MAS coming in time and time again."

At 0915 GMT (4.15 p.m. Jakarta time), the U.S. dollar was at S$1.8095, down from S$1.8130 in Asia late Wednesday .

Against the yen, the U.S. dollar was quoted at Y123.17, below Y123.54 in New York late Wednesday.

The Thai currency rose slightly after the central bank announced late Wednesday that it is tightening offshore baht trading regulations, effective July 2, as part of its attempts to monitor the market and limit speculation.

"There is some wariness about any indication to go down toward the controls route in terms of alleviating the pressure on the currency," said Simmonds at Salomon Smith Barney/Citibank.

But the baht's gains were capped by concerns over Thailand's bleak economic outlook and Prime Minister Thaksin Shinawatra's political fate.

The dollar was quoted at 45.335 baht, down from 45.365 baht late Wednesday.

The yen's rebound and foreign equity fund inflows into their respective bourses bolstered the New Taiwan dollar and the South Korean won, dealers said.

But Taiwan's central bank was suspected to have bought U.S. dollars to slow the New Taiwan dollar's rise, dealers said. The New Taiwan dollar has lagged behind the recent rise in the regional currencies.

The U.S. dollar closed at NT$32.952, down from NT$32.957 Wednesday, as the local benchmark stock index ended 1.2 percent higher.

In Seoul, the dollar ended at 1,301.9 won, down from 1,309.3 won Wednesday, as the benchmark Korea Composite Index leapt 4.2 percent Thursday.