Asian monies mixed; peso, won at multiple months lows
Asian monies mixed; peso, won at multiple months lows
Nirmala Menon, Dow Jones, Singapore
Foreign investors on the South Korean bourse offloaded the won, driving the currency to a three-and-a-half-month trough Friday when markets reopened after a public holiday the previous day.
Meanwhile, fiscal deficit concerns and high oil prices continued to take their toll on the Philippine peso, dragging it to yet another new 14-month low.
The yen's weakness also weighed on the currencies.
The dollar ended at 1,232.4 won, slightly off an intraday high of 1,232.8 won, and up two won from Wednesday. This was the dollar's highest close since June 18.
A trader at Koram Bank said the dollar was in demand from foreign investors looking to convert the won after a heavy selloff on the local bourse this week.
In the Philippines, the dollar hit a peak of 52.755 pesos after an estimate from the Finance Department showed the government's budget deficit hitting 183.27 billion pesos at the end of the year, or nearly 18% more than the government's target of 130 billion pesos.
But it fell back as some exporters offloaded part of their dollar holdings, traders said.
Some traders believe the central bank intermittently sold dollars to support the peso, though Deputy Governor Amando Tetangco denied this.
The dollar closed at 52.725 pesos, yet another new high since Aug. 9, 2001, and up from 52.680 pesos Thursday. The pair moved within a range of 52.670-52.755 pesos during the session.
Tetangco said the peso's weakness is temporary, with the local unit likely supported by the seasonally higher remittance inflows from overseas Filipino workers later this year.
He attributed the peso's decline to the regional weakness and corporate demand for the dollar.
But other regional currencies, such as the Singapore dollar and the Thai baht, firmed after market players squared U.S. dollar positions or took profits on the U.S. unit ahead of the weekend.
Market participants were also waiting for more data from the U.S. later in the global session to gauge the strength of the economy, a senior trader at a Singapore-based Asian bank said. The dollar was quoted around S$1.7804 late Friday, from S$1.7854 Thursday.
Some traders said they are waiting for next week's release of Singapore's third-quarter gross domestic product flash estimates for hints on short-term direction for the local currency, before taking on fresh positions.
Against the baht, the dollar was quoted around 43.505, from 43.555 baht at the previous session close.
Some analysts believe the Asian currency market hasn't started to factor in the impact of the U.S. West Coast ports shutdown.
UBS Warburg, in a note earlier Friday, said a prolonged strike might hurt exports and could potentially have an impact on economic growth as Asian companies are the biggest clients for the ports.
The investment bank estimates that an average 16 percent to 20 percent of Asian exports go through these ports.
"...it is clearly not what Asia needs at this juncture, when export volumes are beginning to moderate and GDP forecasts are being slashed lower anyway," UBS Warburg said.
The U.S. is a key export market for many trade-dependent Asian countries.
Meanwhile, The New Taiwan dollar was hardly changed as U.S. dollar sales by exporters as well as the island's central bank offset a continued exit of foreign funds, traders said.
The U.S. currency ended at NT$34.994, from NT$34.993 at the previous session close.
The U.S. currency hit an intraday high of NT$35.01 earlier in the session as foreign equity investors continued to remit funds out of the island, traders said.
However, traders said exporters unloaded some U.S. dollars when it rose above NT$35.00
The island's central bank, which intervenes in the market regularly, also stepped in to cushion the local unit's fall, some traders said.
Elsewhere, Indonesian financial markets were closed for a Muslim holiday.