Asian monies mostly down in late trading

Asian monies mostly down in late trading

SINGAPORE (Dow Jones): While most other Asian currencies drifted lower late Friday, the Singapore dollar defied the downward pressure, thanks to suspected intervention by the Monetary Authority of Singapore (MAS), dealers said.

Domestic political and economic anxieties had stung the Thai baht, the Philippine peso and the Indonesian rupiah, dealers said.

The MAS - which declined to comment Friday on its rumored actions - was said to have sold U.S. dollars when the U.S. currency climbed to a high of S$1.7380 in overnight trading. This pushed the U.S. currency back down to its recent trading level around S$1.7340, dealers said.

The de facto central bank defended the local currency again around the level of S$1.7330 to S$1.7340 early Friday. Stop-loss orders were triggered when the U.S. dollar sank below S$1.7300, sending the U.S. currency reeling to below the S$1.7380 support level, dealers said.

"We do have a market that was caught long," said Alison Seng, an analyst at market consultants Standard & Poor's MMS International.

Economists said the intervention doesn't herald a shift in the central bank's monetary policy, which is to allow the Singapore dollar to remain broadly stable against a trade-weighted basket of currencies.

Instead, the MAS probably wanted to put the market on notice that it wouldn't tolerate a significantly weaker Singapore dollar, several economists said.

Bank of America said it expects the U.S. dollar's next support level of around S$1.7250 to S$1.7260 to hold, ahead of a move back to S$1.7300.

Strong corporate U.S. dollar demand - needed to fulfill the recent string of overseas acquisitions - and expectations the Indonesian rupiah will weaken further will continue to weigh on the Singapore currency, analysts said.

Worries over the narrowing differentials between U.S. and domestic interest rates hammered the Philippine peso, dealers said. A lower-than-expected domestic oil price hike, however, helped the peso recoup some of its intraday losses, they added.

The dollar closed at 43.230 pesos on the Philippine Dealing System, up from Thursday's close of 43.170 pesos. The dollar rose to an intraday high of 43.320 pesos earlier in the day, its highest level since hitting 43.400 pesos May 25.

The 55-centavo per liter oil price increase, lower than the expected 1.30 pesos per liter, helped the peso recover some of its losses. Earlier Friday, central bank Governor Rafael Buenaventura said an increase of 1.30 pesos would have been inflationary.

In Thailand, political uncertainty, amid heightened fears of an early election, weighed on the baht.

Around 1000 GMT, the dollar was at 39.205 baht, up from 39.165 baht late Thursday.

Mounting concerns over Indonesian President Abdurrahman Wahid's hold on power and whether the country could meet its economic reform deadlines by the middle of next week, which would pave the way for the disbursement of funds by the International Monetary Fund, weighed on the rupiah, dealers said.

Dollar-selling by Jakarta retail investors, however, capped the U.S. currency's ascent around the Rp 8,745 to Rp 8,755 level, dealers said. A lack of offshore buying interest, with the rupiah having moved within narrow ranges recently, also stymied the dollar's rise, they added.

The dollar ended Asian trading at Rp 8,753, up slightly from Rp 8,735 late Thursday.

Dollar-demand by corporates that need to meet their debt repayment schedule and the political uncertainty will likely push the dollar higher to Rp 8,800 next week, dealers said.

The South Korean won barely moved against the U.S. dollar as short-covering of dollars by local banks offset month-end dollar selling by local exporters, traders said.

The dollar finished at 1,115 won, nearly flat from Thursday's close of 1,114.90 won.

The New Taiwan dollar finished higher, bolstered by inward flows that could mean foreign investors are preparing funds to buy stocks at the start of the third quarter.

The U.S. dollar finished lower at NT$30.794, compared with Thursday's close of NT$30.808.