Asian currencies mostly higher against dollar
Agence France-Presse
First Posted 11:59:00 03/30/2008
HONG KONG -- Asian currencies ended the week mostly higher against the dollar as traders remained cautious about the risks of the US economic slowdown.
JAPANESE YEN: The Japanese yen stayed close to its 12-year high against the dollar amid uncertainty about whether an end is yet in sight to the worst of the recent credit crunch, dealers said.
The yen moved in narrow ranges over the week as traders sought fresh clues on the health of the faltering US economy.
The Japanese unit stood at 99.64 to the dollar in late Tokyo trade on Friday, compared with 99.62 a week earlier and near 95.75, a level not seen since September 1995.
The yen was supported as soft US data erased recent optimism that liquidity injections into the financial system by the US Federal Reserve had stemmed the fallout in the banking sector.
The move came after the Fed slashed its base federal funds rate by 75 basis points to 2.25 percent earlier this month. But data on Thursday showed the US economy grew at a 0.6 percent annual pace in the fourth quarter of last year.
The US government also reported an unexpected 1.7 percent decline in durable goods orders in February and a 1.8 percent fall in new home sales.
"Heavy pressure on the dollar is continuing as dealers are cautious about the risks of the credit crunch and the US economic slowdown," said Yuya Koike, currency dealer at Hachijuni Bank.
"Although the dollar was bought temporarily for position adjusting this week, there's no reason to actively buy the greenback," he said.
Meanwhile there was some concern about an unexpected rise in Japan's jobless rate to 3.9 percent in February, along with sluggish consumer spending and a pick-up in core inflation to a fresh decade high of 1.0 percent, dealers said.
AUSTRALIAN DOLLAR: The Australian dollar is expected to rise if the price of gold continues to strengthen in the week ahead, dealers said.
The Australian dollar was trading at 92.25 US cents at 5:00 pm (0600 GMT) Friday, up on the previous week's 91.45 US cents.
Dealers said healthy gold prices encouraged traders in Asia to buy into the commodities-driven currency.
"You're going to see continued strength (in the Australian dollar) if gold continues to strengthen," said Dominic Vaughan, senior dealer with online currency trader CMC Markets.
Chief economist at AMP Capital Investors Shane Oliver said the Aussie had also benefited from higher commodity prices, as well as renewed weakness in the US dollar.
"The ride for the Australian dollar over the next year is likely to be rough as slowing global growth weighs on commodity prices periodically and as Australian growth slows, leading to local interest rate cuts in 2009," he said. "But still high commodity prices and still relatively high local interest rates should ensure that the Australian dollar remains reasonably strong.
"Expect a range of around 85.00 US cents to possibly as high as parity against the US dollar."
The central Reserve Bank of Australia meets on Tuesday to discuss monetary policy but an April interest rate rise is not expected.
NEW ZEALAND DOLLAR: The New Zealand dollar ended the week at 80.42 US cents, slightly up from 80.12 US cents the previous Friday.
For most of the week, the kiwi responded to the fluctuating fortunes of the US dollar and key New Zealand data late in the week had little impact.
The data on Thursday showed a narrowing of New Zealand's current account deficit in the December quarter.
Higher than expected gross domestic product growth of one percent in the last quarter of 2007 saw the kiwi rise a quarter of a cent on Friday but it gave up much of the gain by the end of local trading.
CHINESE YUAN: The yuan closed at 7.0118 to the dollar Friday on the exchange-traded market, compared with Thursday's close of 7.0115, and a closing price of 7.0545 to the dollar the week before.
On the over-the-counter market, it ended at 7.0120 to the dollar against 7.0105 the previous day.
The central bank had set the yuan central parity rate at 7.0137 to the dollar Friday, compared with 7.0130 on Thursday.
The People's Bank of China allows a trading band of 0.5 percent on either side of the midpoint.
HONG KONG DOLLAR: The city's US-linked currency finished the week at 7.78 to the US dollar, compared with 7.774 the previous Friday.
INDONESIAN RUPIAH: The rupiah ended the week trading at 9,213-9,218 to the dollar, down from 9,195-9,200 a week earlier.
PHILIPPINE PESO: The peso fell to 41.82 to the dollar on Friday from 41.690 on March 19. Financial markets were closed for a holiday on March 20-21.
SINGAPORE DOLLAR: The dollar was at 1.3811 Singapore dollars from 1.3886 the previous week.
SOUTH KOREAN WON: The won, which rebounded strongly on Tuesday on eased concerns over a US credit crunch, kept falling the rest of the week as firms bought dollars to send foreign shareholders their dividends.
It closed at 993.0 to the dollar Friday, compared with 1,029.20 a week earlier.
A weaker won has also been driven by South Korea's widening current account deficit.
South Korea recorded a current account deficit for a third month in February but the shortfall narrowed as exports grew at a faster pace and import growth slowed.
The deficit was $2.35 billion in February compared with a revised $2.75 billion shortfall the previous month, the central Bank of Korea said.
TAIWAN DOLLAR: The Taiwan dollar ended the week at 30.402 against the US dollar, up from 30.550 a week earlier.
THAI BAHT: The baht fell against the dollar over the past week as foreign companies repatriated their profits before the end of the quarter, dealers said.
The Thai currency closed Friday at 31.44-46 against the dollar, down from 31.28-29 a week earlier.
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