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.