Asian currencies gain as regional outlook improves

POSITIVE SIGNS::Better-than-estimated export orders in Taiwan and a rise in China’s manufacturing index helped support the region’s currencies


Sun, Nov 25, 2012 - Page 15

Asian currencies had their first weekly gain in a month, led by the Philippine peso, on optimism regional economic growth is starting to pick up.

Taiwanese export orders rose more than estimated last month, government data showed on Tuesday, while a preliminary manufacturing index in China released on Thursday indicated output may have expanded for the first time in 13 months.

“Growth momentum in Asia is clearly taking off,” said Enrico Tanuwidjaja, an economist at Royal Bank of Scotland Group in Singapore. “We have seen some slowing down, but not a collapse. That’s why Asian currencies are supported.”

The Bloomberg-JPMorgan Asia Dollar Index rose 0.2 percent in the past five days after declining for the previous three weeks.

The New Taiwan dollar advanced 0.4 percent this week to NT$29.171 per US dollar, and the peso rose 0.7 percent to 41.052. South Korea’s won appreciated 0.6 percent to 1,086.11, and Malaysia’s ringgit climbed 0.5 percent to 3.0590. China’s yuan gained 0.11 percent to 6.2285.

Overseas investors pumped a net US$625 million into Thai, Philippine and South Korean stocks this week through Thursday, exchange data show.

“Funds continue to come into Asia, which supports regional currencies,” said Kozo Hasegawa, a Bangkok-based foreign-exchange trader at Sumitomo Mitsui Banking Corp. “Data out of China are improving, providing some relief to investors to buy emerging-market assets.”

The peso approached the strongest level since March 2008 on Friday, after Bangko Sentral ng Pilipinas Assistant Governor Cyd Amador told reporters in Manila on Thursday that the monetary authority has allowed some appreciation in the currency as it sees “very strong” overseas remittances and inflows into business-process outsourcing. The bank will maintain an orderly foreign-exchange market, while keeping a flexible exchange-rate policy, she said.

The won pared its weekly advance, falling for a third day, as concern the government would act to stem currency gains offset optimism the Chinese economy is recovering.

South Korean Deputy Finance Minister Choi Jong Ku said on Thursday there was “herd behavior” in the currency market and the government would take action to curb excessive fluctuations. The won has rallied 6.1 percent against the US dollar this year.

“There’s risk appetite in the market with data from China, but caution against government intervention will restrict won gains,” said Kim Dong Young, a Seoul-based currency dealer for Industrial Bank of Korea.

Elsewhere, Thailand’s baht rose 0.2 percent this week to 30.69 per US dollar, while Indonesia’s rupiah fell 0.3 percent to 9,655. India’s rupee lost 0.6 percent to 55.5150 and Vietnam’s dong was little changed at 20,853.