Asian monies down, dollar stable
Asian monies down, dollar stable
Dow Jones, Singapore
The dollar edged higher against most Asian currencies Monday,
helped by its relatively stable performance against the yen.
The New Taiwan dollar, Singapore dollar and Philippine peso
weakened, while the Indonesian rupiah was unchanged.
The South Korean won and Thai baht were not actively traded
because markets in Seoul and Bangkok were closed for public
holidays.
The rangebound trading of the dollar against the yen set a
subdued tone for its trading against other Asian currencies,
analysts said.
Concerns that the Japanese government might intervene in
foreign exchange markets to prop up the dollar against the yen
helped keep a floor under the U.S. currency.
The Bank of Japan has bought tens of billions worth of dollars
in recent weeks in an attempt to cap the yen's strength.
Authorities are worried a rapid appreciation of the yen will hurt
the competitiveness of Japanese exporters in global markets and
set back the country's economic recovery.
The fact that the Bank of Japan's intervention on Friday was
done through the U.S. Federal Reserve and the European Central
Bank suggests that Japanese authorities have the approval of
their U.S. and European counterparts, analysts said.
Bank of America noted that the timing of the intervention --
right after the conclusion of the Group of Eight summit -- "can
hardly have been accidental."
In Taipei, intervention by the central bank offset a round of
U.S. dollar selling by Taiwanese exporters.
Like the Japanese government, authorities in Taiwan are
concerned the country's export competitiveness will suffer if the
local currency rises too fast.
The U.S. dollar closed at NT$33.568, up from NT$33.558 on
Friday. The U.S. currency was trading around its intraday low of
NT$33.510 when the central bank began buying dollars, dealers
said.
The Singapore dollar drifted lower throughout the day, but
remained in a tight range.
Late in Asia the U.S. dollar was quoted at S$1.7660, up from
S$1.7622 late Friday. It traded between S$1.7638 and S$1.7665.
The U.S. dollar slipped in early trade on selling by some
banks on behalf of their corporate clients. However, the U.S.
currency's fall below S$1.7640 prompted a large local bank to buy
U.S. dollars, possibly to cover its short U.S. dollar positions,
dealers said.
The Philippine peso was a touch weaker in very thin trading
conditions.
The dollar had difficulty advancing due to light corporate
demand for the U.S. currency, dealers said. Foreign currency
remittances from Filipinos working abroad provided some support
to the peso.
The dollar closed at 50.430 pesos on the Philippine Dealing
System, up from 50.420 pesos Friday. Trading volume thinned to
$86 million from $154 million on Friday.
The Indonesian rupiah strengthened in the morning session, but
gave up its gains later in the day on the heels of a 2.5% drop in
Jakarta's main stock index.
The dollar closed at Rp 8,715 after trading as low as Rp 8,590
earlier in the day.
Fresh economic data issued Monday had little impact on
currency trading.
On a positive note, the government reported that inflation
fell to 11.48 percent in June from 12.93 percent in May.
News on the trade front wasn't as promising. The government
reported that the country's trade surplus narrowed to $2.31
billion in May from $2.34 billion in April.