Currencies mixed late; rupiah steady
Currencies mixed late; rupiah steady
SINGAPORE (Dow Jones): Asian currencies were mixed late
Thursday, as the market groped for direction amid persistent
worries the problems in Indonesia could explode, dealers said.
Market participants held back their dollar-selling amid
lingering anxiety over Indonesia's political problems and as
optimism the U.S. Federal Reserve would be less aggressive in its
rate hikes ebbed.
Meanwhile, the yen's recent vigor smothered the dollar's
ascent against the other regional currencies, keeping trading
confined within narrow ranges, dealers said.
The market is awaiting the release Friday of Japan's first-
quarter economic report card. During the January to March
quarter, Japan's economy is projected to have grown a strong 2.8
percent quarter-on-quarter. Regional currencies could get a boost
Friday if the actual data surprises on the upside, currency
watchers said.
After rising to an intraday high of Rp 8,685, the dollar
closed at Rp 8,623, virtually unchanged from Rp 8,620 late
Wednesday.
Currency watchers said the dollar is set to climb to IDR8,800
in the next few weeks with Indonesia's political imbroglio.
Although President Abdurrahman " Gus Dur" Wahid Wednesday
dismissed speculation that he faces possible impeachment, saying
he had received assurances of support from Indonesia's political
party leaders, the market remains wary.
"The risk of impeachment has never been discounted, although
constitutionally, they can't remove him unless he violates the
constitution," said Philip Wee, treasury economist at Standard
Chartered Bank.
The feud between Gus Dur and central bank Governor Sjahril
Sabirin continued to make investors nervous. Mounting pressure on
Sjahril - who was declared a suspect in the Bank Bali scandal -
to resign has raised doubts over the independence of the central
bank and created more anxiety over Wahid's fragile
administration. Sjahril has resisted Gus Dur's calls for him to
step down.
Market participants are also bracing for any verbal attack
expected to be made by Gus Dur against the central bank governor
during his two-week overseas trip, which started Wednesday,
dealers said.
The glum sentiment in the regional market and major local oil
refiners' move Thursday to hike retail prices of petroleum
products, which sparked fears of higher inflation, dented the
Philippine peso.
The dollar closed at 42.480 pesos on the Philippine Dealing
System, up from Wednesday's close of 42.360 pesos.
The market positioned behind the dollar following the
announcement late Wednesday of an average 40-centavo increase in
prices of petroleum products by major local oil refiners,
effective Thursday.
Indirect intervention by the South Korean government shored up
the dollar against the local currency, dealers said.
After trading in a very narrow range of less than two won, the
dollar finished at 1,115.30 won, up from Wednesday's close at
1,113.10 won.
State-run Korea Development Bank bought dollars around 1,114
won shortly after Thursday's open, following the U.S. currency's
finish Wednesday at a one-month low. Dollar-selling Wednesday by
foreign investors to finance their heavy investments in the Seoul
stock market had lifted the won.
The New Taiwan dollar ended marginally lower, eroded by
outflows of foreign equity funds from the local stock market,
dealers said.
The U.S. dollar was at NT$30.796, up slightly from the
previous close of NT$30.791.
Against the Singapore currency, the dollar slipped to
S$1.7200, from S$1.7222 late Wednesday in the absence of fresh
news. The U.S. dollar traded within its recent range of S$1.7189
and S$1.7238 Thursday.
In Thailand, the dollar edged up to 38.985 baht, from 38.895
late Wednesday.