Most Asian currencies weaken, peso tumbles to fresh record low
Most Asian currencies weaken, peso tumbles to fresh record low
SINGAPORE (Dow Jones): Most Asian currencies weakened late on Tuesday, with the Philippine peso feeling the brunt of the pain as it tumbled to a fresh record low.
Renewed strength in crude oil prices overnight - fueled by mounting concerns over escalating strife in the Middle East and a cold snap that hit the U.S. Northeast - combined with the languid performance on Asian bourses to push the currencies lower, dealers said.
The Indonesian rupiah closed slightly lower in quiet trading at Rp 8,825 against the U.S. dollar from Rp 8,812 late Monday.
Still, the rupiah was mostly unaffected by slides in the Thai baht and Philippine peso as foreign participants preferred to speculate on those currencies and not on the rupiah, dealers said.
"They prefer trading the dollar against the baht and the peso as their directions are clearer than the rupiah's direction," said a dealer with a foreign bank.
The rupiah's illiquid trading since late last week has also made it difficult for participants to square positions, dealers noted.
However, they said, eventually the rupiah will be hit by the slide of other regional currencies.
Dealers expect the dollar to trade between Rp 8,800 and Rp 8,850 Wednesday.
The Philippine peso moved into uncharted waters again for the second time in a week, skidding to its lowest level in history against the U.S. dollar, on the region's weakness and heightened political anxieties.
The dollar closed at 46.890 pesos on the Philippine Dealing System, up from Monday's close of 46.550 pesos.
Fears of potential impeachment proceedings against President Joseph Estrada, following allegations that he and his family received kickbacks from illegal gambling operations, continued to unnerve market participants, dealers said.
The Thai baht continued to fall on higher oil prices, a weak euro and rising political tensions ahead of the country's general elections, expected later this year, dealers said.
In late Asian trade, the dollar was at 42.875 baht, up from 42.585 baht late Monday.
The Singapore dollar was unaffected by robust economic data released earlier in the day, and yielded to the pressure from its regional counterparts and the weak euro, dealers said.
The Ministry for Trade and Industry Tuesday raised its economic growth forecast for 2000 to around 9 percent, from a range of 7.5 percent to 8.5 percent previously.
The U.S. dollar climbed to as high as S$1.7525 before retreating late in the day to S$1.7502, little changed from S$1.7498 late Monday.
Also, despite weakness against the U.S. dollar, the Singapore dollar has appreciated by about 1.5 percent against the currencies of its major trading partners since late July, when the de facto central bank signaled its preference for a stronger local currency, the economist said.
He added that the U.S. dollar will likely trade between S$1.7300 and S$1.7600 for the rest of the year, "with bias toward the upside."
In South Korea, the dollar finished at 1,119 won, up from Monday's close of 1,117 won.
Taiwan financial markets were closed on Tuesday for a national holiday.