Asian monies higher, dollar weakens
Asian monies higher, dollar weakens
Alan Yonan Jr., Singapore, Dow Jones
The dollar resumed its downward trend in Asia Friday after a
short-lived rally on Wall Street fizzled and investor focus
returned to vulnerabilities facing the U.S. currency.
The yen set the tone, strengthening through the key 128-per-
dollar level as it recouped losses suffered over the previous two
sessions.
Other regional currencies followed suit as the bearish dollar
sentiment spread.
"The dollar's rebound lost momentum very quickly," said Peter
Redward, currency strategist at Deutsche Bank in Singapore.
That's not surprising given that the dollar faces a number of
longer-term hurdles, including a widening current account
deficit, a negative interest rate differential with Europe, and
slack foreign demand for U.S. assets, he said.
"The headwinds are very strong for the U.S. dollar right now,"
Redward said.
The dollar traded in a fairly wide range against the yen
during Asian hours, climbing as high as 128.69 yen before
tumbling late in the session to 127.83 yen, down from 128.33 yen
late Thursday in New York.
The South Korean won gained as exporters sold dollars and took
profits following the U.S. currency's recent rise.
The dollar finished at 1,280.0 won, down from Thursday's close
of 1,282.4 won.
"Names in the electronics and heavy industries have been heard
unloading their dollar holdings since late yesterday to take
advantage of the dollar's rebound," Bank of America said in a
research note.
The won's advance was tempered by continued net foreign sales
of local shares. Foreigners sold a net 214 billion won worth of
shares Friday, bringing total net sales this month to more than
800 billion won.
The New Taiwan dollar strengthened for the first time in three
sessions as interbank traders in Taipei sold the U.S. currency
amid the yen's rise.
The U.S. dollar closed at NT$34.573, down from NT$34.605
Thursday.
The New Taiwan dollar's rise would have been ever greater had
the central bank not bought U.S. dollars in the last minutes of
trading as part of its policy to keep the local currency from
appreciating too fast.
Importers and exporters were not active in the market, dealers
said. Importers retreated to the sidelines after having bought
sufficient U.S. dollars for their needs in previous sessions.
Exporters, meanwhile, were interested in selling the U.S. dollar
around NT$34.60 and considered Friday's too low.
The Philippine peso tracked other regional currencies to a
stronger finish, ending a two-session losing streak.
The dollar closed at 49.620 pesos on the Philippine Dealing
System, down from 49.890 pesos Thursday.
The rebound in Asian currencies was generally supportive of
the Singapore dollar, although direct buying interest in the
local currency was very thin, dealers said.
Late in Asia the U.S. dollar was quoted at S$1.8070, down from
S$1.8114 late Thursday.
The Thai baht also shadowed the strengthening yen. Near the
end of Asian trading the dollar was quoted at 42.920 baht, down
from 42.950 baht late Thursday.
Against the rupiah, the dollar was quoted at Rp 9,290,
slightly down from its close at Rp 9,300 Wednesday. The market
was closed Thursday for a public holiday.
Dealers said trading was quiet because most players hadn't
returned to the market yet after the holiday.