S'pore dollar, Thai baht strengthen on rupiah's surge

S'pore dollar, Thai baht strengthen on rupiah's surge

SINGAPORE (Dow Jones): Asian currencies rose across the board
against the U.S. dollar late Wednesday, boosted by the yen's
slight rebound and heavy stock market inflows to the region.

Analysts said the Indonesia rupiah's surge also helped buoy
the Singapore dollar and the Thai baht in particular, both of
which had deviated from the general trend the previous day and
declined against the U.S. currency.

A slew of good news from Indonesia allowed the rupiah to make
significant gains in the past 24 hours to Rp 7,280 against the
U.S. dollar late Wednesday, compared with Rp 7,420 late Tuesday.

Analysts attributed the rupiah's rise to both signs that a
standoff between the Indonesian President Abdurrahman Wahid and
embattled former armed forces chief, Gen. Wiranto, will soon blow
over peacefully and to the removal of key management officials at
automaker Astra International.

Meanwhile on Tuesday, the Indonesian government fired Astra's
president director and chief financial director on the ground the
two officials had obstructed the sale of a 45 percent stake to
foreign investors.

The sale of the stake to a U.S. investor group would help the
government, which owns a controlling stake in the company, to
plug its budget deficit as well as facilitate the company's debt
restructuring.

Steven Brice, treasury economist at Standard Chartered Bank,
said the Astra development sends an important signal that the
Indonesian government is committed to corporate restructuring.

Against the South Korean won, the U.S. dollar is quoted at
1,123.1 won late Wednesday, lower than 1,128.8 won late Tuesday.

Heavy equities inflows - the South Korean stock market climbed
1.5 percent Wednesday - as well as investments into domestic
assets fueled the won's strength, which observers say could soon
trigger central bank action.

The Bank of Korea wasn't seen in the foreign exchange market
Wednesday, dealers said.

However, analysts say the yen's relative weakness is certain
to prompt some dollar-buying soon by the Korean central bank to
prevent the won from strengthening too far and hurting the
country's export competitiveness with Japan.

The U.S. dollar is quoted at S$1.6912 late Wednesday, down
slightly from S$1.6948 late Tuesday.

Analysts said the Singapore dollar's greater sensitivity to G-
7 currency movements prevented it from rising Tuesday along with
other Asian currencies.

"The Singapore dollar's correlation with the yen is a lot
stronger than that of other Asian currencies," said Lian Chia
Liang, Asian currency strategist at Merrill Lynch.

Against the Thai baht, the U.S. dollar is quoted at 37.545
baht late Wednesday, down from 37.625 baht late Tuesday.

The U.S. dollar is also quoted at 40.460 pesos in Manila,
lower than 40.498 pesos late Tuesday.

And in Taipei, the U.S. unit is trading at NT$30.665, down
from NT$30.731 late Tuesday.