Asian currencies strengthened this week, led by South Korea’s won and the Indonesian rupiah, as a global stocks rally spurred demand for emerging-market assets.
The won gained the most in almost three months against the dollar and the rupiah climbed for the first week in nine after Bank of America Corp, JPMorgan Chase & Co and Citigroup Inc said they were profitable.
The Bloomberg-JPMorgan Asia Dollar Index had its best weekly advance this year after the US, the region’s biggest export market, reported a smaller drop in last month’s retail sales than economists forecast.
The won was at 1,483.50 per dollar as of 3pm in Seoul on Friday, 4.5 percent higher than a week ago.
The rupiah rose 0.9 percent this week to 11,978.
The Asia Dollar Index climbed 0.7 percent this week, its best performance since the period ended Dec. 19.
Malaysia’s ringgit gained 0.3 percent this week to 3.7055 per dollar in Kuala Lumpur.
The Malaysian government on Tuesday announced a US$16 billion economic stimulus plan to help sustain growth.
The US, Japan, Singapore, Hong Kong and Taiwan are all already in recession.
The rupee was at 51.5875 per dollar in Mumbai, up 0.2 percent from a week ago.
The New Taiwan dollar rose 0.8 percent this week to NT$34.495 versus the US currency, Singapore’s strengthened 0.3 percent to S$1.5422 and the Thai baht climbed 0.4 percent to 35.94.
The Philippine peso and Vietnam’s dong were both little changed at 48.550 and 17,482.50, respectively.
The US dollar was slightly lower against the euro and the pound on Friday as China’s premier warned the US not to let the dollar get too weak through massive deficit spending.
The euro traded at US$1.2898, up from US$1.2862, while the British pound gained to US$1.3970 from US$1.3909.
The dollar edged up to ¥98.04 from ¥97.99.
On Friday, the US Commerce Department said the US trade deficit dropped to a six-year low in January as imports, especially of crude oil, slid. The trade imbalance stood at US$36 billion in January, down nearly 10 percent from the month prior. It stands to contract from last year if the pace keeps on — even as US exports are dropping, imports are falling even more sharply.
In 2007, the US trade deficit narrowed after setting records for five years in a row.
A smaller trade imbalance is a long-term positive for the dollar, Bank of New York Mellon Corp senior currency strategist Michael Woolfolk said.
The trade deficit with China rose 3.5 percent, however, to US$20.6 billion.
In other New York trading, the greenback rose to 1.1890 Swiss francs from SF1.1880 late on Thursday, and slipped to C$1.2747 from C$1.2788.
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