Asian monies flat as dealing slows for start of Ramadhan
Asian monies flat as dealing slows for start of Ramadhan
HONG KONG (Dow Jones): Dealing in Asian currencies ground to a
halt Friday as traders and investors closed their books at the
start of Ramadhan and in the approach of the New Year.
Only the South Korean won moved significantly, dropping
rapidly against the U.S. dollar at the start of trading in Seoul,
before activity there tailed off, too, and the currency moved
sideways for the remainder of the session.
Other regional currencies hardly budged, with those traders
still at their desks universally complaining at how quiet the
markets were.
Some observers, however, interpreted the hush in Asian markets
as a broadly positive sign.
"The recent stability in regional currencies shows the market
is optimistic on the longer term outlook and it's only the Y2K
problem that's stopping investors rushing in now," said Steven
Brice, treasury economist at Standard Chartered Bank in
Singapore.
Few investors are prepared to take positions in Asian
currencies except the Singapore dollar and Hong Kong dollar ahead
of the new year. But any knee-jerk dips in other regional
currencies caused by year 2000 problems are likely to be taken as
buying opportunities by foreign investors, whom Brice expects to
move assets back into Asian markets in the first quarter, if the
millennium fallout is not too severe.
That wait-and-see approach kept Southeast Asian currencies
tightly range-bound Friday, with the Singapore dollar, Indonesian
rupiah, Thai baht and Philippine peso barely moving.
The announcement early Friday that the Korean finance ministry
is to issue 1 trillion won in won stabilization bonds to fund
foreign exchange market intervention Monday helped damp sentiment
toward the South Korean won.
Since the won hit a two-year high Wednesday, with the U.S.
dollar falling to 1,126 won, the Seoul authorities have stepped
up efforts to prop up the U.S. currency, in order to safeguard
the competitiveness of South Korea's exports.
Heavy dollar-buying by the state-controlled Korea Development
Bank further lifted the U.S. currency at the start of Friday's
trading.
At the close, the dollar was quoted at 1,132.80 won, up from
1,130.10 won the day before.
Against the New Taiwan dollar, the U.S. currency closed at
NT$31.618, up marginally from NT$31.616 the previous day.
In Southeast Asia, the Singapore dollar ended Asian hours
little changed. Late in the day, the U.S. currency was at
S$1.6780, down a touch from S$1.6808 Thursday.
Against the rupiah, the dollar eased fractionally to Rp 7,220,
from Rp 7,235 late the day before.
In Manila, the U.S. currency closed against the Philippine
peso at 40.710 pesos, unchanged from the day before.
With markets in Bangkok closed for a holiday, the baht was
scarcely traded in the offshore market. Late in Asia the dollar
was quoted against the Thai currency at 38.6100 baht, compared
with 38.6550 baht the previous day.