Asian foreign exchange rates down, rising oil prices cited
Asian foreign exchange rates down, rising oil prices cited
Dow Jones, Singapore
Most Asian currencies weakened modestly Tuesday as rising oil
prices and negative sentiment toward the yen underpinned the U.S.
dollar in the region.
Crude oil prices hit a six-month high of US$26.88 a barrel
overnight on the New York Mercantile Exchange on fears that
tensions in the Middle East could disrupt supplies.
Adding to upward pressure on crude prices during Asian trading
hours were comments by foreign ministers from Iraq and Iran that
oil would be a potent weapon in pressuring the U.S. to force
Israel out of Palestinian areas.
The ministers spoke at a meeting of the 57-member Organization
of the Islamic Conference being held in Kuala Lumpur to discuss
terrorism.
Saudi Arabia and other Gulf Cooperation Council states have
resisted such calls in the past, but Arab frustration with U.S.
policies that are seen as favoring Israel has deepened as Israel
has stepped up its military response to a wave of suicide
bombings.
Higher crude prices tend to have a negative impact on the
currencies of oil importing countries because crude is priced in
U.S. dollars.
If a country's oil consumption remains constant while prices
are rising it must convert more of its currency to U.S. dollars
to settle its oil purchases.
The Thai baht, which has fallen around 1 percent over the past
two weeks, continued its slide.
Near the end of Asian trading the U.S. dollar was quoted at
43.730 bath, up from 43.600 bath late Monday.
The U.S. dollar got off to a poor start against the yen, but
gained ground later in the session as concerns about Japan's
economy increased selling pressure on the local currency.
Late in Asia the U.S. dollar was quoted at 133.42 yen, little
changed from 133.43 yen late Monday in New York. The dollar was
at 133.35 yen late Monday in Tokyo.
The rupiah slipped as corporations took advantage of the U.S.
dollar's recent slump against the local currency to stock up on
the U.S. unit at a favorable exchange rate.
Near the end of Asian trading, the dollar was quoted at Rp
9,800, up from Rp 9,760 a day earlier.
The rupiah rallied against the dollar in recent weeks on
increased investor confidence regarding government privatization
and debt restructuring efforts.
In Seoul, importer U.S. dollar-buying and poor yen sentiment
kept the South Korean won on the defensive.
The U.S. dollar closed at 1,329.0 won, up from Monday's close
at 1,327.5 won.
The New Taiwan dollar ended little changed as central bank
intervention offset the positive impact of foreign equity
inflows.
The U.S. dollar closed at NT$35.005, compared with the
previous close of NT$35.002.
The Philippine peso edged lower, weighed down by corporate
demand for U.S. dollars that had accumulated over the long
holiday weekend, traders said.
The dollar closed at 51.140 pesos on the Philippine Dealing
System, up from 51.000 pesos Monday.
The Singapore dollar ended a touch higher after trading in a
narrow range throughout the session.
Late in Asia the U.S. dollar was quoted at S$1.8470, compared
with S$1.8475 late Monday.