Ringgit and rupiah pushed to new lows
Ringgit and rupiah pushed to new lows
SINGAPORE (AFP): The Malaysian ringgit and the Indonesian
rupiah slumped to new lows against the U.S. dollar in overnight
European trading after they came under attack from hedge funds
pouncing on Southeast Asian currency weakness, dealers said
yesterday.
In early Asian trading yesterday, the U.S. dollar was fetching
2.5885 ringgit and 2,479 rupiah.
The attack in Europe was a follow-up to the one late Wednesday
in Asia when funds pushed the regional currencies sharply lower,
catching many central banks by surprise.
These fresh attacks ended a brief spell of uneasy calm on
regional currency markets, which came under intense speculative
pressure on Monday following the de facto devaluation of the Thai
baht on July 2 and the Philippine peso last week.
"Some hedge funds tried to pressure the ringgit and rupiah,
they sold quite a chunk of these currencies," said Alison Seng,
analyst with U.S. finance house MMS International.
The ringgit plunged to a 34-month low of 2.5920 against the
greenback from Wednesday's Asian close of 2.5700.
The rupiah fell to 2,480.00 after hitting a low of 2,485
against the U.S. dollar from Wednesday's close of 2,471.
Some hedge funds believed they could use thin liquidity
expected yesterday due to a Moslem public holiday in Malaysia and
Indonesia to pin down the currencies of the two countries,
dealers said.
But foreign exchange sources said some state-linked Malaysian
banks and brokers had been asked to return to work yesterday to
help check ringgit volatility on behalf of the central bank.
Dealers said the Singapore dollar also seemed to be under
pressure yesterday as funds turned their attention to the robust
currency after the overnight attack against the ringgit and
rupiah.
The Singapore unit was trading higher at 1.4531 against the
greenback from Wednesday's close of 1.4455.
"The players seem to think that the ringgit and rupiah had
come down substantially and there were prospects for the
Singapore dollar to also come down," Seng of MMS International
said.
The peso was trading yesterday at 29.257 from Wednesday's
close of 29.30 while the Thai baht hovered at 29.90 from 29.85.