Most Asian monies mixed late, rupiah mostly flat

Most Asian monies mixed late, rupiah mostly flat

S. Anuradha, Dow Jones, Singapore

Asian currencies were mixed late Friday, with comments by
several central bankers in the region indicating different levels
of comfort with the dollar's recent weakness.

The Korean won fell against the dollar as the market struggled
to interpret remarks by the Bank of Korea, while the Thai baht
finished firmer thanks to equities-related inflows and the
central bank's reassurance it was comfortable with the baht's
strength.

The rupiah, Singapore dollar, Taiwanese dollar and peso were
mostly flat late, although the central bank governor in the
Philippines said he thought the peso should trade higher.

Friday's trade continued to be muted with many participants
distracted by key World Cup matches, and volume in many markets
was thin.

Early in the session, Bank of Korea Governor Park Seung said
that the recent weakening in the dollar against the won has
reduced the need for an interest rate hike in Korea, a comment
some took to indicate the central bank would tolerate a stronger
won. But Park also said the central bank will have to buy dollars
in the market if the U.S. currency's drop versus the won is
"excessive" - suggesting the bank won't let the won strengthen
much more.

The market eventually chose to focus on the latter
interpretation after a spate of afternoon dollar-buying by state-
run banks spurred a round of dollar short-covering, pushing up
the dollar to 1,236.1 won, above Wednesday's finish at 1,233.6.
South Korean markets were closed Thursday for a holiday.

In Singapore, the dollar dipped against the local currency
after Moody's Investors Service announced a surprise upgrade of
the nation's ratings. The dollar hit an intraday low of S$1.7835
after Moody's raised Singapore's foreign currency country
ceilings for bonds and deposits, as well as the government's
foreign currency rating, to Aaa, its highest grade, from Aa1.

The dollar closed at S$1.7865, unchanged from levels a day
earlier.

In Thailand, the dollar finished at 42.175 baht, down from
42.265 baht Thursday. Capital inflows for foreigners' portfolio
investments continued to weigh on the U.S. currency, a Bangkok
dealer said.

Elsewhere, the Philippine peso closed flat amid a dearth of
fresh incentives. The dollar closed at its intraday high of
50.470 pesos, little changed from 50.465 pesos Thursday, as a
recent rally by the U.S. currency appeared to be running out of
steam.

The peso's downside was supported by comments from the
country's central bank chief, who said the dollar should fall
below 50.00 pesos given the strong foreign-exchange inflows and
expectations of a sizable balance-of-payments surplus this year.

The New Taiwan dollar ended stronger against its U.S.
counterpart on U.S. dollar selling by exporters - although the
rise was capped by central bank intervention, dealers said.

At 0800 GMT (3 p.m. Jakarta time), the U.S. dollar closed at
NT$34.112, down from NT$34.121 Thursday.

One dealer said the central bank's U.S. dollar bids totaled
around US$150 million.

The Indonesian rupiah ended steady in range-bound trading, but
is expected to head higher next week following gains in local
stock prices in the last four sessions, dealers said.

The dollar closed at Rp 8,740, little changed from its close
at Rp 8,745 Thursday.

Dealers said that dollar demand from local companies to pay
maturing offshore debts offset dollar offers from foreign banks,
leaving the dollar range-bound.

Local companies are saddled by around $60 billion of foreign
debts, which they borrowed before the 1997-1998 Asian financial
crisis. Most Indonesian companies only managed to get a three-
year rollover on the payment of the debts, which means some of
them started making repayments last year. Offshore debt payments
occasionally weigh on the rupiah.