Most Asian Currencies Up Late; Airport Siege Hurts Peso
Dow Jones Singapore
Most Asian currencies strengthened ON Monday as the dollar failed to capitalize on economic data indicating that a long-awaited pickup in U.S. jobs growth is finally underway.
Analysts said the dollar's poor response to the numbers suggests that much of the good news about the U.S. economy has already been priced in to exchange rates, and that investors believe growth prospects in Asia are better than in the U.S.
The U.S. Labor Department on Friday reported that nonfarm payroll jobs rose by 126,000 in October and a revised 125,000 in September, the largest back-to-back increase in national employment since late 2000.
Until now, job creation on that scale was viewed as the missing link to a sustainable U.S. economic recovery.
In Asia on Monday, the only regional Asian currency to lag the dollar was the Philippine peso, which came under selling pressure after a weekend incident in which two armed men took control of the Manila airport control tower.
Authorities on Monday were investigating whether the men - former Air Transport Office chief Panfilo Villaruel and navy reserve officer Ricardo Catchillar - acted alone or were part of a bigger plot.
Police fatally shot the two after a four-hour standoff. Near the airport, police later found an abandoned car loaded with 33 blocks of explosives. The car was believed used by Catchillar.
The dollar closed at 55.365 peso on the Philippine Dealing System, up from 55.270 peso on Friday.
The peso is expected to remain on the defensive for the remainder of the year due to uncertainties regarding the political situation in the Philippines heading into next May's elections.
The progress on Monday toward ending a constitutional standoff between members of Congress and the Supreme Court is a positive development, but political risk is still a major concern.
The South Korean won strengthened to a three-week high as foreign investors continued to pour money into the local stock market.
The dollar finished at 1,174 won, down from Friday's close of 1,179.3 won.
The lack of noticeable official intervention to slow the won's rise also encouraged market participants to sell the dollar a bit more aggressively, traders said.
The New Taiwan dollar gained modestly after trading in a narrow range against its U.S. counterpart.
The U.S. dollar closed at NT$33.975, down from NT$34.012 on Friday. The currency pair traded between NT$34.026 and NT$33.970.
A trader at a local bank attributed the lack of trading activity to a dearth of domestic news, and a quiet session in the dollar/yen market.
Against the Singapore dollar, the U.S. currency was quoted at S$1.7378 in late Asian trading, down from S$1.7412 late on Friday in Asia. It traded between S$1.7375 and S$1.7405 intraday.
The U.S. dollar opened near its session high of S$1.7405 but retreated to the intraday low S$1.7375 by midafternoon as some investors, disappointed by the U.S. dollar's inability to ride on last week's gains, took profit.
Market participants will soon be turning their attention to a government report on Singapore's third-quarter economic performance scheduled for release next Monday.
According to advance estimates, the island's gross domestic product expanded 1 percent on year in the third quarter, but some economists expect the number to be revised up slightly in next week's report.
The Indonesian rupiah was unchanged as investors digested the latest news of auditing problems at telephone giant, PT Telekomunikasi Indonesia (Telkom).
The dollar was quoted at Rp 8,485 late in the Asian session.
Shares in Telkom tumbled 2.6 percent on Monday after falling by nearly 5 percent on Friday. Telkom has said that it may reduce 2002 net profit by between 4 percent and 20 percent from earlier reported due to an ongoing reaudit.