Rupiah, other Asian monies up
Rupiah, other Asian monies up
Netty Ismail, Dow Jones, Singapore
Asian currencies were stronger late Thursday, as the dollar took a drubbing in international foreign exchange markets, particularly against the yen.
The yen vaulted through the psychologically important 130 yen threshold against the dollar to trade at two-and-a-half month highs, after dollar sales by foreign investors triggered a slew of stop-loss orders.
At 0900 GMT (4.00 p.m. Jakarta time), the dollar was quoted at 129.32 yen, below 130.77 yen late Wednesday in New York. The dollar had shed more than a full yen during the overnight session.
The yen also chalked up gains against its other Asian counterparts, as the Japanese currency's vigor was unrivaled.
With the market having largely priced in expectations of an economic recovery in Asia, excluding Japan, later in the year, participants who had gone long Asian currencies against the yen in the last few months were now unwinding those positions; at the same time that they unloaded their short yen positions against the dollar.
The yen's strength was evident in the yen/won.
The yen rose to 10.17 won, from around 9.9 won just two days ago, even as the South Korean currency strengthened against the dollar Thursday.
Against the dollar, the won closed at 1,314.5 won, slightly stronger compared with 1,316.3 won Wednesday.
The market shrugged off the Bank of Korea's as-expected decision Thursday to keep its call rate target unchanged at 4 percent in March, as the economy shows signs of accelerated growth and inflationary pressures remain benign. The overnight call rate target has been maintained at 4 percent since late last year.
Late in the day, as the dollar collapsed below the key 129 yen level, several Asian currencies extended their gains. At 0940 GMT, the dollar was quoted at 128.95 yen.
As Asian currencies continue to receive a boost from the yen's gains and capital inflows in the region, some of the central banks - particularly in Taiwan, Singapore and Thailand - could become concerned over any excessive appreciation in their currencies. Since the anticipated economic recovery in the region has yet to take hold, it would be too early for the monetary authorities to allow their currencies to strengthen too much.
The U.S. dollar closed at NT$34.989, down from NT$35.030 Wednesday. Dealings were valued at US$983 million, higher than US$602 million Wednesday. A dealer in Taipei said the central bank accounted for around half of Thursday's turnover.
As the baht climbed to a one-year high, the Thai central bank continued with its recent dollar-purchases to check its strength, although not aggressively, dealers said.
The dollar was at 43.275 baht, lower than 43.515 baht late Wednesday.
The Singapore dollar was at S$1.8208 against its U.S. counterpart, stronger compared with S$1.8263.
With the Singapore dollar currently trading near the stronger end of the central bank's policy band, there's been ongoing jitters about intervention, dealers said.
The Monetary Authority of Singapore guides the Singapore dollar within a trading band against a basket of currencies of the city state's major trading partners and key competitors. In January, the MAS restored a tighter policy band.
Inspired by its regional peers, the Philippine peso cracked above the psychologically important 51.00 pesos resistance level against the dollar for the first time in two-and-a-half months.
The dollar ended at 50.99 pesos, lower than 51.09 pesos Wednesday.
The Indonesian currency was slightly firmer at Rp 9,945 to the dollar, compared with Rp 9,950 late Wednesday.