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.