Sun, Jul 01, 2012 - Page 15 News List

Asian currencies rise on EU accord

Bloomberg and Staff writer, with CNA

Asian currencies strengthened this week as European leaders agreed on measures to ease a regional debt crisis and data suggested the US housing market is recovering from a slump.

The Bloomberg-JPMorgan Asia Dollar Index rose on Friday by the most since Oct. 27 after EU President Herman Van Rompuy said bailout conditions tied to emergency loans for Spanish banks were relaxed and regional leaders ere looking at ways to bring down yields on bonds issued by Spain and Italy.

Led by a rising euro on Friday, the New Taiwan dollar continued its advance since Tuesday and closed the week up 0.2 percent against the US dollar at NT$29.90.

The strength of the euro came after the EU summit agreed to mobilize 120 billion euros (US$150 billion) to stimulate the ailing economy in the region, dealers said.

India’s rupee gained by the most in three years on Friday after Prime Minister Manmohan Singh said reviving investor confidence was one of his top priorities. The currency tumbled 8.6 percent against the US dollar this quarter, leading declines in Asia.

The Asia Dollar Index climbed 0.8 percent this week to 115.22 in Hong Kong, trimming this quarter’s loss to 1.4 percent. South Korea’s won advanced 1 percent this week to 1,145.40 per US dollar and the Philippine peso rose 0.7 percent to 42.16, according to data compiled by Bloomberg. The rupee jumped 2.7 percent to 55.6375, touching a one-week high of 55.6375 earlier.

US reports this week also showed that sales of new homes climbed to a two-year high in May, while housing prices declined in April at the slowest pace since November 2010. An improving real-estate market may spur spending in the US, the biggest buyer of Asian exports.

China’s yuan rose this week, trimming its biggest quarterly loss since a US dollar peg ended in 2005. It traded at 6.3541 per US dollar, 0.16 percent stronger than its June 21 close. It has dropped 0.9 percent since the end of March.

The peso jumped 3.2 percent since May, its biggest monthly gain since September 2010, as an improving economy attracted funds to the nation’s assets. The US$200 billion economy expanded 6.4 percent in the first quarter, the fastest pace since 2010, and is projected to expand by the same rate in the second, an economics official said.

Elsewhere, Malaysia’s ringgit rose 0.8 percent this week to 3.1688 per US dollar, Indonesia’s rupiah gained 0.1 percent to 9,430 and Thailand’s baht rose 0.1 percent to 31.74.

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