Taiwanese, Indian, S Korean currencies fall on oil concerns


Fri, Jul 14, 2006 - Page 11

Asian currencies, including the New Taiwan dollar and Indian rupee, fell on concern about the possibility that the record high level of oil prices will spur importers to purchase more dollars to pay for the commodity.

Most Asian nations import the majority of their oil needs, with Taiwan importing 98 percent of crude usage and India about 75 percent. The NT dollar, Indian rupee and South Korean won all slipped to their lowest levels this month yesterday.

"When oil prices are rising, local oil companies tend to rush to buy crude before their prices increase further," said Tetsuo Yoshikoshi, a market analyst of the treasury unit in Singapore at Sumitomo Mitsui Banking Corp.

"That increases the demand for dollars to buy oil and weighs on Asian currencies," Sumitomo said.

The NT dollar dropped 0.3 percent to close at NT$32.576 against its US counterpart, according to Taipei Forex Inc. The rupee fell 0.1 percent to 46.2788 per US dollar, according to foreign-exchange broker Kanji Pitamber & Co. The won fell 0.1 percent to 949.3 against the greenback, according to Seoul Money Brokerage Services Ltd.

The price of crude oil has climbed 26 percent this year, and touched a record US$75.89 a barrel yesterday, after newspaper reports that militants had attacked pipelines in Nigeria, halting 120,000 barrels a day of production.

In other trading yesterday, the Indonesian rupiah was little changed at 9,100 per US dollar. The Thai baht slipped 0.1 percent to 37.91 per US dollar and the Philippine peso dropped 0.3 percent to 52.32 from 52.17 yesterday.