The US dollar held in a narrow range against the other main currencies on Friday as traders tried to gauge the impact of a massive financial sector bailout and digested news of bigger-than-expected US job losses.
The euro, which had at one point plunged to a near 12-month low of US$1.3703, later rebounded and was trading at US$1.3781 at 9pm GMT against US$1.3818 late on Thursday. The US currency was little changed at ¥105.27 from ¥105.28 on Thursday.
Trading was volatile as dealers kept a close eye on events in Washington, where the US House of Representatives approved a US$700 billion plan to salvage the shattered financial system and restore confidence to global lenders. The measure was quickly signed by US President George W. Bush.
John Kicklighter at Forex Capital Markets cited a “muted reaction” from traders, suggesting “there may be skepticism over this bill’s effectiveness.”
While markets tried to assess the impact of the plan, trade was impacted by the troubles in the banking sector.
“The euro weakened against the dollar after a surge in demand for dollars,” Christine Li at Moody’s Economy.com said.
“The escalation in the financial turmoil has caused many European financial institutions to seek to repay their dollar loans, causing a shortage,” Li said.
Earlier in the day, the euro was under pressure from comments by European Central Bank (ECB) President Jean-Claude Trichet that were taken to mean a reduction in eurozone interest rates, perhaps as early as next month.
Trichet signaled a shift at the ECB, where it now appears that threats to eurozone growth, rather that inflation, are concentrating minds.
Analysts said the change in priorities pointed to a cut in the benchmark rate, which currently stands at 4.25 percent, far higher than the US Federal Reserve’s 2 percent.
The dollar’s gains were later stalled on a report from the US Labor Department that the US economy lost 159,000 jobs last month as the weight of a housing collapse and credit crunch hit a broad swath of industries.
The report, seen as one of the best indicators of economic momentum, showed a sharp rise in the number of cuts after 73,000 job losses in August.
In late New York trading, the dollar stood at 1.1287 Swiss francs from SF1.1353 on Thursday.
The pound was at US$1.7722 after US$1.7635 on Thursday.
Malaysia’s ringgit and the Thai baht fell this week on concern the deepening credit crisis will push the US economy into a recession and reduce demand for Asian exports and emerging-market assets.
The Philippine peso and the Singapore dollar also declined as a regional stock index slumped 7.6 percent, the worst week in 13 months. Overseas investors pulled almost 26 billion ringgit (US$7.5 billion) from Malaysia’s debt market since April, according to data from the central bank.
The ringgit fell 0.9 percent this week to 3.4670 per US dollar as of 4:15pm on Friday in Kuala Lumpur, its biggest decline since the five days ended Sept. 5, according to data compiled by Bloomberg. The baht declined 0.8 percent this week to 34.21.
The Singapore dollar dropped 1.4 percent in the five days to S$1.4488.
The Philippine peso declined 0.6 percent this week to 47.025, extending its losses this year to 12.2 percent, according to Tullett Prebon Plc.
Elsewhere, the New Taiwan dollar lost 0.4 percent this week to NT$32.18 and Vietnam’s dong was unchanged at 16,600.
LONG FLIGHT: The jets would be flown by US pilots, with Taiwanese copilots in the two-seat F-16D variant to help familiarize them with the aircraft, the source said The US is expected to fly 10 Lockheed Martin F-16C/D Block 70/72 jets to Taiwan over the coming months to fulfill a long-awaited order of 66 aircraft, a defense official said yesterday. Word that the first batch of the jets would be delivered soon was welcome news to Taiwan, which has become concerned about delays in the delivery of US arms amid rising military tensions with China. Speaking on condition of anonymity, the official said the initial tranche of the nation’s F-16s are rolling off assembly lines in the US and would be flown under their own power to Taiwan by way
‘OF COURSE A COUNTRY’: The president outlined that Taiwan has all the necessary features of a nation, including citizens, land, government and sovereignty President William Lai (賴清德) discussed the meaning of “nation” during a speech in New Taipei City last night, emphasizing that Taiwan is a country as he condemned China’s misinterpretation of UN Resolution 2758. The speech was the first in a series of 10 that Lai is scheduled to give across Taiwan. It is the responsibility of Taiwanese citizens to stand united to defend their national sovereignty, democracy, liberty, way of life and the future of the next generation, Lai said. This is the most important legacy the people of this era could pass on to future generations, he said. Lai went on to discuss
OBJECTS AT SEA: Satellites with synthetic-aperture radar could aid in the detection of small Chinese boats attempting to illegally enter Taiwan, the space agency head said Taiwan aims to send the nation’s first low Earth orbit (LEO) satellite into space in 2027, while the first Formosat-8 and Formosat-9 spacecraft are to be launched in October and 2028 respectively, the National Science and Technology Council said yesterday. The council laid out its space development plan in a report reviewed by members of the legislature’s Education and Culture Committee. Six LEO satellites would be produced in the initial phase, with the first one, the B5G-1A, scheduled to be launched in 2027, the council said in the report. Regarding the second satellite, the B5G-1B, the government plans to work with private contractors
MISSION: The Indo-Pacific region is ‘the priority theater,’ where the task of deterrence extends across the entire region, including Taiwan, the US Pacific Fleet commander said The US Navy’s “mission of deterrence” in the Indo-Pacific theater applies to Taiwan, Pacific Fleet Commander Admiral Stephen Koehler told the South China Sea Conference on Tuesday. The conference, organized by the Center for Strategic and International Studies (CSIS), is an international platform for senior officials and experts from countries with security interests in the region. “The Pacific Fleet’s mission is to deter aggression across the Western Pacific, together with our allies and partners, and to prevail in combat if necessary, Koehler said in the event’s keynote speech. “That mission of deterrence applies regionwide — including the South China Sea and Taiwan,” he
RSS