Asian currencies ex-Japan fell this week, led by South Korea’s won, as Chinese economic data missed estimates and a stronger US recovery added to speculation the US Federal Reserve would cut its stimulus further.
The Bloomberg-JPMorgan Asia Dollar Index dropped for a second week as reports showed US sales of existing homes last month capped the best year since 2006 and jobless claims held near a six-week low. Signs of a sustained economic pickup fueled bets the Fed will continue to reduce bond-buying that has spurred fund flows to emerging markets.
Manufacturing in China, Asia’s biggest economy, may have contracted this month, a preliminary reading showed on Thursday.
“Weak data in China are strengthening demand for safety assets like the dollar,” said Hong Seok-chan, a currency analyst at Daishin Economy Research Institute in Seoul. “US tapering expectations offer a continued boost for the greenback.”
The won recorded its worst week in seven months, slumping 1.9 percent from Jan. 17 to 1,080.36 per US dollar, data compiled by Bloomberg show.
In Taipei, the New Taiwan dollar slid 0.7 percent to NT$30.42 from NT$30.221 on Jan. 17.
Exporters sold their US dollar holdings to meet payments in the local currency ahead of the Lunar New Year holiday, and the selling is likely continue until the forex market closes for holiday on Thursday, dealers said.
Trading will resume on Feb. 5.
Foreign institutional investors also boosted demand for the local currency, buying a net NT$1.9 billion (US$62.46 million) in shares on Friday, dealers said.
Putting further downward pressure on the US dollar was a rising Chinese yuan, after the People’s Bank of China raised the reference rate for the yuan against the greenback, they said.
The yuan rose 0.02 percent this week to 6.0488.
Malaysia’s ringgit slid 1.1 percent, its biggest weekly loss in a month, to 3.3334. India’s rupee dropped 1.8 percent, the most since August, to 62.6850, and Indonesia’s rupiah fell 0.7 percent to 12,180.
The Philippine peso slipped 0.6 percent to 45.307 per US dollar and Thailand’s baht weakened 0.1 percent to 32.84. Vietnam’s dong climbed 0.02 percent to 21,085.
Meanwhile, the yen rallied the most in a week versus the US dollar since August, as a selloff in emerging-market currencies stoked demand for haven assets.
The yen gained against all but two of 174 global peers, and the Swiss franc rose the most since September, as increased scrutiny of credit risks in China boosted refuge demand.
Argentina’s peso tumbled 15 percent as the worst global performer after the country devalued the currency.
The yen rallied 1.9 percent to ¥102.31 per US dollar this week after reaching ¥102, the biggest advance since the week ended Aug. 9 and the strongest level since Dec. 6. It appreciated 0.9 percent to ¥139.98 per euro.
The 18-nation currency rose 1 percent to US$1.3678.
The pound also strengthened to a two-and-a-half-year high versus the greenback as the unemployment rate in the three months through November fell to 7.1 percent, beating analyst expectations and prompting Bank of England Governor Mark Carney to pledge to keep down interest rates to support the recovery.
The UK currency gained 0.4 percent in the week to US$1.6491 on Friday, after touching US$1.6668, the highest level since May 2011. However, the pound weakened 0.6 percent to £0.8293 per euro after appreciating to £0.8168 on Wednesday, the strongest since Jan. 10 last year.
China has claimed a breakthrough in developing homegrown chipmaking equipment, an important step in overcoming US sanctions designed to thwart Beijing’s semiconductor goals. State-linked organizations are advised to use a new laser-based immersion lithography machine with a resolution of 65 nanometers or better, the Chinese Ministry of Industry and Information Technology (MIIT) said in an announcement this month. Although the note does not specify the supplier, the spec marks a significant step up from the previous most advanced indigenous equipment — developed by Shanghai Micro Electronics Equipment Group Co (SMEE, 上海微電子) — which stood at about 90 nanometers. MIIT’s claimed advances last
Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) has appointed Rose Castanares, executive vice president of TSMC Arizona, as president of the subsidiary, which is responsible for carrying out massive investments by the Taiwanese tech giant in the US state, the company said in a statement yesterday. Castanares will succeed Brian Harrison as president of the Arizona subsidiary on Oct. 1 after the incumbent president steps down from the position with a transfer to the Arizona CEO office to serve as an advisor to TSMC Arizona’s chairman, the statement said. According to TSMC, Harrison is scheduled to retire on Dec. 31. Castanares joined TSMC in
EUROPE ON HOLD: Among a flurry of announcements, Intel said it would postpone new factories in Germany and Poland, but remains committed to its US expansion Intel Corp chief executive officer Pat Gelsinger has landed Amazon.com Inc’s Amazon Web Services (AWS) as a customer for the company’s manufacturing business, potentially bringing work to new plants under construction in the US and boosting his efforts to turn around the embattled chipmaker. Intel and AWS are to coinvest in a custom semiconductor for artificial intelligence computing — what is known as a fabric chip — in a “multiyear, multibillion-dollar framework,” Intel said in a statement on Monday. The work would rely on Intel’s 18A process, an advanced chipmaking technology. Intel shares rose more than 8 percent in late trading after the
FACTORY SHIFT: While Taiwan produces most of the world’s AI servers, firms are under pressure to move manufacturing amid geopolitical tensions Lenovo Group Ltd (聯想) started building artificial intelligence (AI) servers in India’s south, the latest boon for the rapidly growing country’s push to become a high-tech powerhouse. The company yesterday said it has started making the large, powerful computers in Pondicherry, southeastern India, moving beyond products such as laptops and smartphones. The Chinese company would also build out its facilities in the Bangalore region, including a research lab with a focus on AI. Lenovo’s plans mark another win for Indian Prime Minister Narendra Modi, who tries to attract more technology investment into the country. While India’s tense relationship with China has suffered setbacks