Southeast Asian currencies slip lower in listless trading
Southeast Asian currencies slip lower in listless trading
SINGAPORE (Dow Jones): Southeast Asian currencies slipped a
touch lower against the U.S. currency, sold down in listless
trading in Asia on Tuesday in response to fall in the value of
the Japanese yen.
With market participants expecting Japanese monetary officials
to continue to attempt to guide the U.S. dollar/yen exchange rate
up towards 120 yen in the approach to the end of Japan's fiscal
year on March 31, most dealers are predicting further U.S. dollar
appreciation against the regional currencies over the next week.
Despite Thailand's signing of a fresh letter of intent to the
International Monetary Fund late Monday, committing the
government to fresh banking sector reforms, few traders would be
surprised to see the U.S. currency creep higher against the baht.
Late Tuesday in Asia, the U.S. dollar was trading at 37.5300
baht, up from 37.4650 baht late Monday.
The Singapore dollar also ended Asian hours lower on Tuesday,
with dealers in Singapore saying that the local currency
attracted unusually strong selling interest.
Toward the end of Asian trading, the U.S. dollar was quoted at
S$1.7326, up from S$1.7270 late in Asia the day before.
The Indonesian rupiah also closed Asian trading down. In
recent months many observers have predicted the U.S. dollar would
rally beyond 10,000 rupiah ahead of parliamentary elections
scheduled for June. Now, however, some cast doubt on those
forecasts.
"The rupiah has already priced in further social conflict and
instability ahead of the elections," said Daniel Lian, head of
Asian markets research at ANZ investment bank in Singapore.
With little potential flight capital still remaining in
Indonesia, and foreign players for the most part shunning all
exposure to the country, current foreign exchange market flows
are not sufficient to push the U.S. dollar significantly higher,
Lian said.
On the other hand, he also felt the 7,500 rupiah exchange rate
target described Tuesday by Sjahril Sabirin, Bank Indonesia's
governor, was somewhat overly optimistic.
"I don't see how that can be realized until there is a
solution to Indonesia's political vacuum," he said.
The rupiah closed Asian trading at 8,910, compared with 8,900
on Monday.
Elsewhere in Asia, trading on the Philippine Dealing System
ended with the peso slightly weaker on the day. At the close, the
U.S. dollar was quoted at 38.760 pesos, up from 38.710 pesos at
Monday's close.
In North Asia, both the new Taiwan dollar and the South Korean
won closed lower.
Against the new Taiwan dollar, the U.S. currency ended at
NT$33.127, up from NT$33.106 at Monday's close.
Against the won, the U.S. currency closed at 1,225.00 won,
compared with 1,222.60 won at the end of the previous session.