Asian currencies mostly up on yen's bounce, U.S. economy
Asian currencies mostly up on yen's bounce, U.S. economy
SINGAPORE (Dow Jones): Most Asian currencies were higher late
Tuesday as the yen's bounce and signs that the U.S. industrial
sector may be bottoming out brought some relief to the market,
dealers said.
The yen had gained on Japanese Prime Minister Junichiro
Koizumi's remarks to the Financial Times that Japan has "no
intention whatsoever of consciously bringing the yen lower."
At 0845 GMT (3.45 p.m. Jakarta time), the dollar was quoted at
123.93 yen, below 124.33 yen late Monday in New York.
Market participants also welcomed the latest data showing an
improvement in the beleaguered U.S. industrial sector.
The June National Association of Purchasing Management
manufacturing index was 44.7, better than economists'
expectations of a 42.0 reading. Although a reading under 50
indicates a contracting manufacturing sector, the index implies a
small growth in the overall economy.
But the data won't be enough to provide an antidote to the
regional malaise, analysts said.
"For now, the figures present a glimmer of hope for exporters
in Asia ex-Japan," said Philip Wee, a market strategist at
Singapore's DBS Bank. "Unfortunately, a modest U.S. recovery is
unlikely to help in a big way, not with the Tankan survey
reaffirming recession fears in Japan, and Europe increasingly
under recession watch."
Meanwhile, the Indonesian rupiah ended flat after giving up
all of its earlier gains in thin trade, as some local
participants reversed their dollar selling.
After falling to an intraday low of Rp 11,290, the dollar
ended at Rp 11,320, unchanged from its close Monday.
The dollar had slid to an intraday low on the back of the high
22 percent overnight rupiah interest rate in the interbank money
market.
The South Korean won led the advance in the region's foreign
exchange markets as the currency continued to find support from
foreign fund inflows and hopes of a U.S. economic recovery,
dealers said.
The won received an additional boost from stop-loss dollar
sales by local banks, and market talk late in the session that
the South Korean government may sell some dollar receipts from
the sale of Korea Telecom American Depositary Receipts last week.
The dollar finished at 1,292.3 won, down 1,301.0 won Monday.
Expectations that the South Korean central bank would lower
its policy rate during its monthly meeting Thursday also
supported the won, since it would help stimulate the country's
economic growth, said Frank Gong, an economist at Bank of
America.
The Singapore dollar and the New Taiwan dollar also received a
fillip from the yen's rise and the encouraging U.S. economic
data, dealers said.
Against the Singapore dollar, the U.S. currency was at
S$1.8221, lower than S$1.8227 late Monday.
The U.S. dollar closed at NT$34.394, lower than Monday's close
of NT$34.428, in dealings valued at US$351.5 million.
The Thai baht and the Philippine peso were left out with
respect to the region's gains.
Comments by Thai central bank Governor Pridiyathorn Devakula
Tuesday that the central bank would focus on keeping the baht in
line with a basket of currencies, which include Asian currencies
and those of Thailand's trade partners and competitors, prompted
the market to push the baht lower.
The Thai currency was at 45.450 baht against the dollar,
weaker compared with 45.325 baht late Monday.
Corporate demand for dollars and domestic security anxieties
continued to weigh on the Philippine peso, dealers said.
The dollar closed at 52.940 pesos, up from 52.700 pesos
Monday.