Southeast Asian currencies range-bound in quiet trade

Southeast Asian currencies range-bound in quiet trade

SINGAPORE (Reuter): Southeast Asian currencies kicked the week off in a drowsy state against the dollar yesterday with Tokyo closed for a one-day holiday.

Dealers said trade was cautious ahead of the annual meeting of the World Bank and the International Monetary Fund (IMF), which opens in Hong Kong on Wednesday, in case it turned up surprises. They said a 2.4 percent rise in Malaysia's August Consumer Price Index (CPI) failed to make an impact.

"So far there's no reaction. The figure is more or less expected. I don't think there will be any impact," said one dealer with a European bank in Singapore.

At 09:15 GMT, the ringgit was at 2.9650/00 to the dollar. "We are seeing a lot of interest for dollar/ringgit at around 2.9550 level. But activity is limited with Tokyo closed," said a dealer with a U.S. bank.

Malaysian Prime Minister Mahathir Mohammad's meeting on Sunday with international fund managers, aimed at regaining market confidence lost with a series of policy decisions which outraged the market, succeeded in boosting sentiment.

"This is seen as positive by the market," said a dealer with a Malaysian bank, who added that local corporate selling was expected to limit the dollar's upside.

Commercial demand for the dollar dampened a Thai baht plagued by political concerns and worries ahead of the Bank of Thailand's release of foreign reserve data later on Monday.

The baht was quoted onshore at 36.600/700 to the dollar against 36.25/36.35 late on Friday.

"There is normally dollar demand on Monday morning after the weekend, but I think the market is fairly neutral, though very cautious," said a dealer at a local bank.

In the offshore market, the baht was at 35.180/280 to the dollar against 35.03/35.13 late on Friday.

The Indonesian rupiah was stable against the dollar, quickly shrugging off the central bank's expected cut in interest rates.

A Jakarta bank dealer said the rupiah weakened slightly to 2,942 from 2,935 after the cut.

It was trading at 2,940/5.00 at 0915 GMT. Bank Indonesia cut interest rates for bilateral papers (SBIs) by one to two percentage points. Rates for one-and two-week SBIs were cut by one percentage point to 18 and 20 percent, respectively.

The Singapore dollar held steady at 1.5115/25 to the dollar, underpinned by a rise in Singapore's official reserves to Singapore $116.98 billion in July, dealers said.

The Singapore dollar was expected to trade within a band of 1.5080/180 this week ahead of the announcement of several key economic figures, including non-oil exports for August and retail sales for July.

The Philippine peso was weaker on commercial demand for the dollar, notably by local importers. It opened at 32.33 to the dollar and was trading at 32.100/400 by late Monday.

Dealers said they expected the peso to remain under pressure at 32 due to lingering political concerns over the political intentions of President Fidel Ramos.

He is limited to a single term, but has not been definitive about where he stands on moves by supporters to change the constitution to allow him to run in presidential elections.