SE Asian currencies lower in late trading

SE Asian currencies lower in late trading

SINGAPORE (Dow Jones): Southeast Asian currencies are lower in late trading yesterday, although the U.S. dollar has steadily come off highs seen in early morning trading.

The Indonesian rupiah bucked the trend, holding steady in thin trade on anticipation of good news later Thursday from a meeting of international lenders in Paris.

Other regional currencies have retreated from levels seen late Wednesday in Asia, in line with losses overnight by the Japanese yen.

The yen fell before Asian trading opened Thursday on reports suggesting that former Prime Minister Kiichi Miyazawa, who officially became Japan's finance minister late Thursday, may endorse a reflationary policy and abandon the effort to support the yen.

In a late trading, the dollar was quoted at 142.29-32 yen against 142.28 in early trading here and 142.38 yen in New York Wednesday afternoon.

Chua Soon Hock, chief strategist for Sanwa Bank in Singapore, said however that Japan's economic policies will be good for the Japanese economy and, ultimately, good for the yen and other Asian currencies.

Japan is looking at an expansionary fiscal policy, tax cuts and fiscal stimulus coupled with a very loose monetary policy," Chua said. "You can't ask for a better policy mix to jump-start an economy."

In this environment, Chua said, regional currencies have stabilized and even strengthened.

The Singapore dollar fell Thursday morning, but regained ground steadily against the U.S. dollar throughout the day. Position-squaring by commercial entities was the main influence on the market, traders said.

Singapore dollar

The trader said that, technically, U.S. dollar would gain on the Singapore dollar eventually, but added that it may take awhile.

"For the upward trend to change, the U.S. dollar has to go below S$1.6950. I don't think that is likely to happen," he said.

In a late trading, the U.S. dollar was quoted at S$1.7119, up from S$1.7085 late Wednesday in Asia, but down from intraday highs of S$1.7230.

Dealers in Singapore said trading in the ringgit was thin, despite speculation in Malaysia that the ruling party, the United Malays National Organization, may call elections before the year is out to hold the polls before the economy worsens.

In a late trading, the U.S. dollar is quoted at 4.1260 ringgit, up from 4.1115 ringgit late Wednesday.

Trading was also sluggish in the Thai baht.

"The government postponed its big data release scheduled for today until tomorrow, but the market didn't make much of that," said a trader with a U.S. bank in Singapore. "Everyone knows the economy is bad up there, and people don't really expect any surprises."

Against the baht, the U.S. dollar is quoted at 40.7050 baht, up from 40.6550 baht Wednesday.

On the Philippine Dealing System, the U.S. dollar ended at 41.995 pesos, up from 41.900 baht on Wednesday.

Meanwhile, in Northeast Asia, the South Korean won closed higher again as it remained supported by ample dollars from local exporters, traders said in Seoul.

The dollar closed at 1,234 won, down from 1,244 won Wednesday.

The New Taiwan dollar ended slightly higher against the U.S. currency on month-end corporate demand for the local currency, according to foreign exchange traders in Taipei.

The U.S. dollar ended at NT$34.330, down from NT$34.332 on Wednesday.

Taipei traders said corporations normally buy NT dollars late in the month to pay salaries and suppliers.