SE Asian currencies mixed; baht falls, rupiah rises

SE Asian currencies mixed; baht falls, rupiah rises

SINGAPORE (Dow Jones): Southeast Asian currencies turned in a
mixed performance on Friday. The Thai baht fell, while the
Indonesian rupiah and the Philippine peso inched upward. The
Singapore dollar traded sideways.

In North Asian trading, the South Korean won and the New
Taiwan dollar both ended higher, lifted by the early rise in the
yen.

With the swings in the yen's exchange rate set to remain the
dominant influence on regional foreign exchange markets, most
dealers cautiously predict that Southeast Asian currencies will
stay within broad trading ranges over the coming week.

"All the regionals are very yen-related," said the head of
regional currency trading at one U.S. bank in Singapore.

"None of these moves are very significant. Everybody just
follows the dollar/yen exchange rate until the market is caught
either long or short, and then they just go for the stops," he
added, referring to stop loss orders, which are pre-placed to
close out positions should the exchange rate move adversely.

Only in Thailand, where the market awaits the results of
Friday's Financial Sector Restructuring Authority auction of a
notional US$6 billion-worth of defunct finance company assets,
are traders eying developments in the local market.

"The results of the FRA auction won't be great, but there
won't be a big impact on the market," said a trader at a second
U.S. bank in Singapore, reflecting the generally held view in the
market.

Following a call earlier in the week from Supachai
Panitchpakdi, Thailand's deputy prime minister and commerce
minister, for the baht to weaken in order to assist struggling
Thai exporters, traders are generally looking to buy the dollar
on any dips.

With good bidding interest set to support the U.S. currency
around 37.20 baht, most players see the dollar pushing towards
the top of its current range around 37.70 baht, although many
feel it will remain capped at that level.

Late in Asia on Friday, the U.S. dollar was quoted at 37.49500
baht, up from 37.4650 baht towards Thursday's close.

In contrast, the rupiah strengthened markedly on Friday after
selling pushed the U.S. dollar down through the Rp 9,000 barrier,
triggering around $20 million worth of stop loss sales, according
to one trader's estimate.

The U.S. currency stabilized in later trading, ending Asian
hours at Rp 8,900, down from Rp 9,025 late the previous day.
Against the Singapore dollar, the U.S. dollar ended almost flat
on the day.

According to a trader at a local bank the U.S. dollar
encountered strong buying interest on being sold down to
S$1.7220. With that level seen providing a short term floor for
the U.S. currency, over the coming week he expects the U.S.
dollar to test upside resistance around S$1.7300.

Late in Asia, the U.S. dollar was at S$1.7232, little
different from S$1.7239 at the same time the day before.

On the Philippine Dealing System, the peso ended higher,
lifted by the rise in the yen. At the close the U.S. dollar was
quoted at 38.750 pesos, compared with 38.865 pesos on Thursday.

Most market participants expect the peso to remain steady
through the coming week, unaffected by the central bank's slight
reduction of short term interest rates late Friday after the
local market had closed.

In North Asia the won ended higher, with the U.S. dollar
slipping to close at 1,220.80 won, down from 1,224.40 won the day
before.

Against the Taiwanese currency, the U.S. dollar ended at
NT$33.096, compared with NT$33.107 the previous day.