Asian currencies stronger as local issues take center stage

Asian currencies stronger as local issues take center stage

SINGAPORE (Dow Jones): Asian currencies are stronger against
the U.S. dollar in choppy trading late Wednesday, as salient
domestic issues take center stage in currency markets across the
region.

There was some early session liquidation of long U.S. dollar
positions following the U.S. Federal Open Market Committee's
decision to leave U.S. rates unchanged. But U.S. dollar strength
was a non-factor as it gradually drifted higher against the yen
during the session, traders said.

In late trading, the U.S. dollar was trading at 107.13 yen, up
from 06.61 yen in late Asian trading Tuesday.

Instead, the Thai baht remained relatively strong, following
the Bank of Thailand's decision Tuesday to strictly adhere to a
cap on offshore baht lending.

The South Korean won also stayed firm against the U.S. dollar,
after government comments Wednesday that there would be no
further stock price manipulation and tax evasion probes into
Hyundai Group.

The Indonesian rupiah moved sideways during the session, as
the presidential election process continued to run smoothly,
following the election of Akbar Tandjung as parliamentary speaker
late Tuesday.

The U.S. dollar was also trading at Rp 7,740, down from Rp
7,780 late Tuesday. Traders said there is little incentive to
sell U.S. dollars in such a thin, volatile market. They remain
convinced that the U.S. dollar will trade between Rp 7,500 and Rp
8,000 as long as the presidential election process proceeds
smoothly and peacefully.

Although the Singapore dollar and Philippine peso lost some of
their overnight and early Asian gains against the U.S. dollar,
the two currencies remained well bid throughout the session,
mirroring the relative strengths of the Thai baht and Indonesian
rupiah.

The New Taiwan dollar remained flat, despite some intraday
volatility.

In late trading, the U.S. dollar was trading at 39.085 baht,
well down from 39.785 baht in late Asian trading Tuesday. Traders
said the Bank of Thailand's move to tighten existing rules
governing baht lending to non-resident parties drove the baht
sharply higher.

The U.S. dollar was also trading at 1203.7 won, well down from
1207.8 won in late trading Tuesday.

South Korea's Financial Supervisory Commission Chairman Lee
Hun-jai comments Wednesday that there won't be further Hyundai
probes for illegal activity buoyed the local equity market, with
the index soaring 5.5 percent after the announcement.

The U.S. dollar was also trading at NT$31.785, just up from
NT31.78 late Tuesday.

In Southeast Asia, the U.S. dollar was trading at S$1.6764,
well down from S$1.6887 late Tuesday. Traders said government's
repeated statement that the Monetary Authority of Singapore will
not resort to a weak exchange rate policy to underpin regional
and global competitiveness has buoyed the domestic currency.

On the Philippine dealing system, the U.S. dollar was trading
at 39.99 pesos, down from 40.265 pesos late Tuesday.