Asian currencies up and rupiah higher on exporter dollar selling
Asian currencies up and rupiah higher on exporter dollar selling
SINGAPORE (Dow Jones): Most Asian currencies rebounded Thursday in response to local factors and a move by market participants to trim their dollar positions following a recent run-up in the U.S. currency.
Central bank intervention helped the New Taiwan dollar stabilize after it plunged to a nine-month low a day earlier in response to continued political turmoil.
The Thai baht, Philippine Peso, Indonesian rupiah, Singapore dollar and South Korean won all edged marginally higher in the absence of any major negative political or economic news.
"Most major banks were long U.S. dollars and were unwinding their positions," a trader at an Asian bank said.
The rupiah closed higher after a round of exporter dollar selling, but the local currency's rise was capped by ongoing political concerns.
The dollar closed at Rp 8,790, down from Rp 8,820 late Tuesday.
Local exporters pushed the dollar down to an intraday low of Rp 8,760 in the early afternoon. The dollar's rise this week has created an opportunity for companies to move dollar profits back to Indonesia, analysts say.
But a move by state prosecutors to file an appeal against the dropping last week of former president Soeharto's corruption trial sparked a bout of dollar buying in late trade.
Investors are concerned the ongoing political furor around Soeharto could spill over again onto the streets, further destabilizing the country.
The New Taiwan dollar was little changed after the central bank continued its recent pattern of selling U.S. dollars in the open market to support the local currency.
At the close, the U.S. dollar was quoted at NT$31.320, compared with NT$31.322 a day earlier. Wednesday's decline in the currency was inspired by Prime Minister Tang Fei's departure, the latest chapter in Taiwan's ongoing political saga.
Late in Asia, the dollar was quoted at 42.495 Thai baht, down from 42.595 baht late Wednesday.
The South Korean won benefited from a gain in local stocks and, to a lesser extent, the Bank of Korea's surprise decision to raise its one-day call rate by 25 basis points to around 5.25 percent.
The dollar finished at 1,118.50 won, down from Wednesday's close of 1,119.90 won.
The Philippine peso was bolstered by the central bank's move to raise banks' reserve requirements to quell speculative pressure on the local currency, and by intervention by the central bank.
The dollar closed at 46.420 pesos on the Philippine Dealing System, down from 46.460 pesos at the previous close.
The Singapore dollar followed the Thai baht higher. Late Thursday the U.S. dollar was trading at S$1.7472, down from S$1.7483 late Wednesday. In a day of volatile trading, the Singapore dollar weakened to an intraday low of S$1.7511 against the U.S. dollar before recovering.