Most Asian currencies weaken

Most Asian currencies weaken

SINGAPORE (Dow Jones): The political and economic turmoil engulfing the Philippines pushed the peso to yet another record low Wednesday, and analysts cautioned the worst may not be over.

Other Asian currencies finished mostly weaker amid widespread dollar strength against the euro and yen. The Thai baht was slightly higher, while the Korean won was unchanged.

Local corporations and foreign investors dumped the peso in a selloff that lifted the dollar to nearly the 50 peso mark in early trading. The dollar peaked at 49.800 pesos before easing to a record low closing level of 49.650 pesos.

With the Philippines' fiscal outlook deteriorating and no resolution in sight to the political crisis surrounding President Joseph Estrada, the peso is expected to continue its freefall, analysts said. The currency has already fallen nearly 20 percent this year.

"We expect the peso to break 50 pesos (per dollar) in the next few days and 51 pesos by the end of next week." said Peter Redward, currency strategist at Deutsche Bank in Singapore.

The Singapore dollar weakened modestly in lackluster trade, reflecting the market's preference for U.S. dollars ahead of a market holiday Thursday, dealers said.

Late in Asia the U.S. dollar was quoted at S$1.7530, up from S$1.7508 the previous session.

The U.S. dollar had traded in a narrow range of S$1.7500 and $1.7515 for most of the day before moving higher near the end of the trading session.

"The market was mostly moving sideways with some position squaring ahead of the holiday," a trader at a European bank said.

Markets are closed in Singapore Thursday for the Deepavali holiday.

The Thai baht rose as investors unwound long dollar positions amid fears the central bank might step in to support the local currency.

In late Asian trading the dollar was at 43.725 baht, down from 43.845 baht late Tuesday.

Talk of central bank intervention kept market players cautious, although no signs of central bank action were witnessed in the market, dealers said.

The New Taiwan dollar weakened against the U.S. dollar on the back of the softer yen, dealers said.

At the close the dollar was quoted at NT$32.072, compared with NT$32.048 late Tuesday.

Trading was stable with little central bank intervention, dealers said. They added that some liquidation in long U.S. dollar positions could emerge Thursday, keeping the local dollar around current levels.

The South Korean won ended flat following an uneventful session of range-bound trading.

The dollar finished at 1,137.10 won, unchanged from Tuesday's close.

With markets in Indonesia closed for a local holiday, there was only limited, offshore trading in the rupiah. In late Asian trading, the dollar was quoted at Rp 8,965, up slightly from Rp 8,950 late Tuesday.