BLBG:Asian Currencies Weaken on Greek Debt Risk, Importers Buying Dollars
Asian currencies snapped a four-day advance on concern recent gains underestimated the risks to global growth from Europe’s still unresolved debt crisis.
The Thai baht, South Korean won and Taiwan dollar led losses on speculation importers are buying the greenback to take advantage of favorable exchange rates. Greek Prime Minister Lucas Papademos secured a general agreement on budget-cutting measures demanded by creditors even as opposition leaders may object to some of the points needed for the 130 billion-euro ($170 billion) bailout package. The Bloomberg-JPMorgan Asia Dollar Index (ADXY) rallied 1 percent in the last four days, reaching a four-month high on Feb. 3.
“Investors are unsure whether the recent rally reflects the risk of the European debt crisis that’s still not fully resolved,” said Henry Lin, a Taipei-based foreign-exchange trader at Taiwan Shin Kong Commercial Bank.
The baht fell 0.3 percent to 30.93 per dollar as of 9:25 a.m. in Bangkok, according to data compiled by Bloomberg. The won dropped 0.3 percent to 1,121.50 and the Taiwan dollar declined 0.2 percent to NT$29.575.
The Asia Dollar Index, which tracks the region’s 10 most- traded currencies excluding the yen, dropped 0.3 percent, paring its rise this year to 2.1 percent. Emerging-market equity funds have attracted $11.3 billion of inflows this year through Feb. 1, their best start since 2006, according to research firm EPFR Global.
Indonesia GDP
The won snapped a two-day rally even after U.S. employment data last week, showing the jobless rate at a three-year low, buoyed the country’s export outlook.
“The ongoing talks over Greek debt and importers buying the dollar to settle bills may limit gains in the won,” said Han Sung Min, a foreign-exchange dealer at Busan Bank in Seoul.
Indonesia’s rupiah dropped for a second day, losing 0.2 percent to 8,995 per dollar, before data that economists predict will show growth easing to a two-year low. Southeast Asia’s largest economy expanded 6.45 percent in the fourth quarter from a year earlier versus 6.54 percent in the preceding three months, according to the median forecast in a Bloomberg News survey before a report due at 11 a.m. today in Jakarta.
“There are issues of economic growth slowing down,” said Saktiandi Supaat, head of foreign-exchange research at Malayan Banking Bhd. in Singapore. “It has been showing in Indonesian export numbers and the currency.”
China’s yuan dropped 0.10 percent to 6.3093 per dollar in Shanghai, according to China Foreign-Exchange Trade system. The central bank set its reference rate at 6.3108, weaker for a second day.
Elsewhere, the Philippine peso declined 0.2 percent to 42.69 per dollar and Vietnam’s dong weakened 0.1 percent to 20,980. Financial markets in Malaysia are closed for a holiday.
To contact the reporter on this story: David Yong in Singapore at dyong@bloomberg.net;
To contact the editor responsible for this story: Sandy Hendry at shendry@bloomberg.net
