Asian monies end down on N Korea talks failure, SARS

Asian monies end down on N Korea talks failure, SARS

Dow Jones
Jakarta

Concerns over North Korea's nuclear weapons program drove down
the South Korean won on Friday, as other Asian currencies also
ended lower as fears over the mystery SARS virus gripped the
region.

Three-day talks in Beijing between Washington and Pyongyang
aimed at cooling tensions on the Korean peninsula ended in
failure on Friday as a senior U.S. official said North Korea
claimed to have nuclear weapons and threatened to test, export or
use them depending on U.S. actions.

The U.S. dollar ended at 1,238 won, sharply higher than 1,220
won at Thursday's close, on fears of the conflict with North
Korea escalating. South Korean stocks plunged 3.7 percent to
their lowest finish since April.

"The breakdown of the talks really hurt the South Korean won,
of course," said Simon Flint, senior currency strategist at Bank
Of America.

The New Taiwan dollar also ended markedly lower on Friday on
yen weakness sparked by the release of rising Japanese jobless
figures in March, and due to concerns over the spread of SARS, or
severe acute respiratory syndrome.

SARS fears also pushed down currencies in Singapore, Thailand,
and Indonesia, while in the Philippines, concerns over economic
fundamentals, sparked by Standard & Poor's sovereign ratings
downgrade Thursday, continued to dominate negative sentiment
toward the peso.

Although Taiwan hasn't yet reported any SARS death, the U.S.
dollar jumped to NT$34.942, up from NT$34.856 at Thursday's
close.

Investors are concerned that Taiwan's economy - which relies
on China as a manufacturing backyard - will suffer from SARS even
if the island isn't directly hit. Taiwanese stocks ended down 3.2
percent Friday to a fresh six-month low.

There have been 261 reported deaths worldwide from SARS, the
majority in China and Hong Kong, but actual numbers could be much
higher, experts say.

Against the Singapore dollar, the U.S, unit ended higher at
S$1.7829 versus S$1.7775 as the city state's death total from the
virus rose to 19. Authorities there have enforced a strict
quarantine procedure, but fears of further infection remain high.

In Thailand, the dollar finished at 42.865 baht, up from
42.760 baht.

Against the Indonesian rupiah, the U.S. currency closed at Rp
8,740, slightly higher than Rp 8,730.

In the Philippines - which confirmed its first two SARS deaths
Friday - the dollar ended at 53.00 pesos from 52.795 pesos as
players focused mainly on concerns over the country's economic
fundamentals sparked by a sovereign ratings downgrade.

Standard & Poor's Corp. earlier this week cut the sovereign
rating to BB from BB+, citing the government's growing debt
burden.

The agency added in comments to Dow Jones Newswires on Friday
it's concerned that inefficient tax collection might mean the
country will overshoot a 2003 budget deficit target of 4.6
percent of gross domestic product.