Rupiah falls on dollar-buying, peso falls to new record low
Rupiah falls on dollar-buying, peso falls to new record low
JAKARTA (Dow Jones): The Indonesian rupiah closed lower
Thursday on thin volume led by state bank dollar-buying after
falls in regional currencies.
Strong market rumors that the chairman of the Indonesian Bank
Restructuring Agency, Cacuk Sudarijanto, will soon be ousted -
which he has denied - also edged the rupiah lower.
Widigdo Sukarman, formerly head of PT Bank Negara Indonesia,
is tipped to replace Cacuk.
The dollar ended at Rp 8,940 in Asia, up from Rp 8,845 late
Wednesday.
The dollar could test the Rp 9,000 resistance level next week
after sharp losses in the Philippine peso and Thai baht, said a
foreign bank treasurer.
"It's not surprising that it's spilled over here," he said,
referring to the regional currency falls.
IBRA's Vice Chairman Arwin Rasyid is leaving to join PT Bank
Danamon Indonesia, sparking fears of political meddling at the
powerful agency.
Attempts by the Philippine central bank to prop up the falling
peso had a minimal impact on Thursday as the country's deepening
political crisis pushed the currency to its second straight
record low.
Philippine President Joseph Estrada Thursday rejected calls
for his resignation in connection with a scandal in which it is
alleged he took payoffs from illegal gambling operations.
The accusations prompted Vice President Gloria Macapagal-
Arroyo to resign from her cabinet post Thursday, and analysts
said they expect other walkouts from Estrada's government.
Philippine Central Bank Governor Rafael Buenaventura, a
longtime friend of Estrada's, has pledged to stick by the
embattled president. Buenaventura also said there was no truth to
rumors that Estrada's closest economic advisors would resign.
Estrada, in a television and radio address, denied accusations
by a provincial governor that he received more than $10 million
in payoffs from illegal gambling operators.
The dollar opened at 47.315 pesos and quickly broke through
the 48.000 peso level on its way to an intraday high of 48.500
pesos. A move by the central bank to raise overnight lending
rates and banks' reserve requirement helped the peso regain some
of its losses, but not enough to prevent it from closing at a
record low of 47.700 per dollar.
The Thai baht finished the Asian trading day below the
psychologically important level of 43 baht per dollar for the
first time since June 1998.
Analysts cited ongoing purchases of dollars by Thai
corporations, concerns over rising energy prices, uncertainty
about upcoming elections, and the weakening peso as major factors
affecting the baht.
Late in Asia, the dollar was quoted at 43.295 baht, up from
42.970 baht late Wednesday.
The Singapore dollar got swept into the peso and baht selling
frenzy, analysts said.
However, the city-state's solid economic fundamentals and
fears of intervention by the Monetary Authority of Singapore
helped minimize the currency's losses, they said.
Late Thursday in Asia, the U.S. dollar was trading at
S$1.7523, up from S$1.7503 late Wednesday.
The South Korean won fell as Seoul stocks ended sharply lower
on a surge of last-minute program-selling.
The dollar finished at 1,122.10 won, up from Wednesday's close
of 1,121.40 won.
The New Taiwan dollar ended lower despite efforts by the
central bank to lift the currency in the wake of a 3.9 percent
plunge in Taiwan stocks.
The U.S. dollar closed at NT$31.300, compared with the
previous close of NT$31.298.
Market participants said the central bank accounted for more
than half of the day's US$500.5 million trading volume, selling
U.S. dollars to support the local currency.