Rupiah lower on foreign debt repayment, other monies mixed
Rupiah lower on foreign debt repayment, other monies mixed
SINGAPORE (Dow Jones): Asian currencies were mixed late
Thursday, as market participants search for direction in the
absence of a final verdict in the U.S. presidential election.
Most Asian currencies opened weaker on expectation of a
decline in regional bourses following an overnight decline in
U.S. equity markets and a variety of local factors.
However, many currencies recovered in the afternoon as
investors and interbank participants unwound long U.S. dollar
positions.
The Indonesian rupiah closed lower as local companies bought
dollars to repay foreign debt, traders said.
The dollar finished higher at Rp 9,245 in Asia, up from Rp
9,195 late Wednesday, after trading in a tight range of between
Rp 9,210 and Rp 9,260.
Traders said state banks were seen selling dollars at the
higher end of the range, possibly on behalf of the central bank.
Profit-taking also kicked in at these higher levels, as
offshore players liquidated their long-dollar positions.
Threats by the central bank to intervene in the foreign
exchange market, and tightened enforcement of rules governing
maximum forward positions, are stopping offshore investors from
building up huge speculative positions against the rupiah.
Still, with state banks set to repay about $2 billion in debt
by the end of this year, the dollar is set for further gains,
analysts say.
Instability in the local political situation, notably a higher
court's decision to reopen former President Soeharto's corruption
trial, continued to weigh on the rupiah.
Investors are concerned that reopening the trial could lead to
renewed clashes between pro and anti-Soeharto supporters.
Soeharto's youngest son, Hutomo Mandala Putra, also known as
Tommy, remained on the run Thursday, after the Supreme Court
handed him an 18-month sentence for corruption.
The Philippine peso and Thai baht opened weaker on remarks by
top local officials, dragging the Singapore dollar lower.
The U.S. dollar rose to a high of 50.87 peso before banks
moved to liquidate their long-dollar positions on fears the
central bank would intervene. The dollar ended at 49.950 pesos on
the Philippine Dealing System, down from 50.100 pesos at the
previous close.
In Thailand, the baht initially fell following remarks by a
central bank official late Wednesday that Republican candidate
George W. Bush's victory could have a negative indirect impact on
the Thai economy and currency.
The dollar rose to high of 43.75 baht before retreating in
line with the peso on selling by onshore banks. It fell to a low
of 43.535 baht but recovered on short-covering in late trading to
43.58 baht, nearly unchanged from 43.57 baht late Wednesday.
The Singapore dollar broadly mirrored the moves in the peso
and baht during most of the Asian session, but remained weaker on
the day due to net outflows from the local stock market.
At 1022 GMT, the U.S. dollar was trading at S$1.7415, up from
S$1.7375 late Wednesday. The U.S. unit's intraday low was
S$1.7380. Dealers said they expect the U.S. dollar to be capped
at S$1.7420 overnight, with demand from Singapore companies
providing support in the near-term around S$1.7350.
North Asian currencies ended higher as their stock markets
bucked the declining trend in most Asian bourses following the
overnight decline in U.S. equities.
The U.S. dollar closed at NT$32.065, down from NT$32.119
Wednesday. Dealings were valued at US$608.5 million, up from
US$509 million Wednesday.
The dollar finished at 1,132.10 won, down from Wednesday's
close of 1,136.60 won and its lowest finish since Oct. 20, when
it ended at 1,128.50 won.
Dealers expect the dollar to continue slipping Friday and said
it will likely trade between 1,128 won and 1,134 won.