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Sun, May 18, 2008 - Page 10 News List

Asian currencies decline amid rising oil, inflation

BLOOMBERG AND CNA , TAIPEI

Asian currencies fell this week, led by India’s rupee and Malaysia’s ringgit, on concern rising energy costs will damp growth, quicken inflation and prompt investors to cut holdings in the region.

Seven of the 10 most-active currencies in the region declined against the US dollar after US Federal Reserve officials said unacceptably high inflation was challenging as crude oil prices touched an all-time high. Economic reports in India, Malaysia and China this week showed central banks are facing the threat of slowing growth and faster inflation.

The rupee fell 2.2 percent in the week to 42.5125 per dollar in Mumbai, according to data compiled by Bloomberg. The currency is the third-worst performer of the most-traded Asian currencies this year with an 8.2 percent loss.

The ringgit fell for a fourth week after Standard & Poor’s on Thursday cut Malaysia’s rating outlook to “stable” from “positive,” citing political uncertainties.

The ringgit gained 1 percent on Friday to 3.2425 per US dollar, the biggest advance since Jan. 25, according to Bloomberg data.

The won gained 0.4 percent this week to 1,041 against the dollar as of the 3pm close of local trading, according to Seoul Money Brokerage Services Ltd. It rose 0.4 percent on Friday.

Singapore’s dollar declined for a fourth week on speculation investors will reduce their holdings of emerging-market assets in favor of the US currency.

The Singapore dollar fell 0.2 percent over the five days to S$1.3713 against the US currency.

The New Taiwan dollar was little changed against the US currency this week.

The NT dollar gained NT$0.220 from Thursday to close at NT$30.660 against the greenback on Friday, according to Taipei Forex Inc.

Elsewhere, the Indonesian rupiah fell 0.6 percent in the week to 9,290, the Philippine peso declined 0.8 percent to 42.80 and the Thai baht lost 1 percent to 32.29. The Vietnamese dong weakened 0.1 percent to 16,168.

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