SE Asian monies move higher

SE Asian monies move higher

SINGAPORE (Dow Jones): Southeast Asian currencies generally
moved higher against the U.S. dollar on Thursday, as traders took
advantage of a lackluster dollar-yen market to take profit by
selling the dollar against regional currencies.

With Japan sidelined because of a public holiday, a
lackadaisical Asian trading session came to life as the Singapore
dollar, Thai baht and Philippine peso climbed against the dollar.

The Indonesian rupiah and new Taiwan dollar remained generally
flat while the South Korean won recorded a slight gain.

Traders said the short-lived bullishness in regional
currencies could be ascribed to dollar profit-taking before long
U.S. dollar positions emerge once again.

Daniel Lian, head of Asian markets research at ANZ Bank in
Singapore, said the dollar should eventually climb to Y123 in
coming weeks as the Bank of Japan is finally forced to underwrite
ailing Japanese government bonds, "paving the way for a more
solid increase in money supply in the future and accelerate the
depreciation of the yen in the process."

In late trading, the U.S. dollar was trading at S$1.6875, well
down from S$1.6947 in late Asian trading Wednesday.

"The Singapore dollar is tracking the yen, as there is a
squaring of positions ahead of Chinese new year," said a trader
at a U.S. bank in Singapore. He noted that as the U.S. dollar
once again head down through Y114, investors had started selling
the U.S. currency against regional currencies. "There were also
some stop-loss orders at S$1.69, which pushed it down a touch
further."

Clifford Tan, foreign exchange and interest rate strategist at
Warburg Dillon Read in Singapore, said in the longer term, the
U.S. dollar should climb to S$1.80, as bleak economic news and
mild deflationary pressures batter the republic.

"And if leading exports start to falter - such as the
electronics sector losing market share in the U.S. - then we
could see further weakening," he said.

The U.S. dollar was also trading on the Philippine Dealing
System at 38.53 pesos, well down from 38.98 pesos late on
Wednesday.

There had been expectations in the market that the dollar
would be quite volatile against the peso Thursday because a
number of non-deliverable contracts came due, traders said.
Instead, the U.S. dollar simply slipped, they said.

"We had been expecting a huge inflow of U.S. dollars, but it
didn't really come about - just odd-lot U.S. dollar selling as
the yen climbed, which pushed the peso higher," said a trader at
a U.S. bank in Singapore.

The dollar was also trading at 36.940 baht, down from 37.0300
baht late Wednesday.

Traders said the dollar moved in a tight range during the
session, trading higher in the morning as offshore buying pushed
the dollar to 37.090 baht and moving lower as onshore dollar
selling pushed the currency as low as 36.930 baht.

Economists said investors will be inspired by news that
Thailand's parliament passed the final reading of a key piece of
economic legislation that will facilitate the foreclosure of
failed companies' assets. However, key bankruptcy reform bills
have yet to be passed by the country's senate.

The dollar was also trading at 8,675 rupiah, almost unchanged
from 8,625 rupiah late Wednesday. Bank Indonesia governor Sjahril
Sabirin said Thursday that interest rates would be kept firm
until the rupiah appears less vulnerable.

In north Asia, the dollar was trading at 1,175.2 won, down a
touch from 1,177.4 won late Wednesday. The U.S. currency was
also trading at 32.285 new Taiwan dollars, little changed from
NT$32.280 late Wednesday.