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Sun, Aug 23, 2009 - Page 10 News List

Won and rupee lead weekly drop in Asian currencies

BLOOMBERG

Asian currencies declined for a second week, led by South Korea’s won and the Indian rupee, on concern tighter credit in China will curb spending in the world’s ­fastest-growing major economy.

The Bloomberg-JPMorgan Asia Dollar Index, which tracks Asia’s 10 most-used currencies excluding the yen, this week reached its lowest level in a month as the Shanghai Composite Index of shares dropped 2.8 percent.

The won dropped 0.9 percent from the end of last week to 1,249.85 per dollar in Seoul, according to data compiled by Bloomberg. The rupee lost 0.7 percent to 48.605 and the Indonesian rupiah slid 0.6 percent to 10,015.

The New Taiwan dollar rose 0.2 percent on Friday to NT$32.906 after second-quarter GDP figures showed Taiwan is recovering from a recession. The economy contracted 7.5 percent from a year earlier, less than the 10.1 percent recorded for the first quarter and the 7.8 percent forecast by economists in a Bloomberg survey. The NT dollar was little changed this week.

The Philippine peso was little changed in offshore trading as local markets were shut for a holiday on Friday. The currency slumped 0.8 percent this week, the most in two months, after the government on Wednesday reported a budget deficit of 188 billion pesos (US$3.9 billion) for the last seven months, equivalent to 75 percent of its full-year projection.

Elsewhere, Thailand’s baht was little changed for the week at 34.01 per US dollar and the Chinese yuan was at 6.8312, having barely moved from 6.8342 last Friday. Malaysia’s ringgit gained 0.1 percent to 3.5125.

The US dollar and yen fell against the majority of their most-traded counterparts as US housing and manufacturing reports signaled that the economy is recovering from recession, easing demand for the currencies as a refuge.

The euro also rose on the week against the dollar and yen as German services and French ­manufacturing unexpectedly expanded this month.

The greenback slumped 0.9 percent to US$1.4326 per euro on Friday from US$1.4203 on Aug. 14, while also dropping more than 1 percent against the South African rand, Swedish krona, Canadian dollar and Swiss franc. The yen fell 0.3 percent to ¥135.21 per euro, from ¥134.84 last week. Japan’s currency also declined versus the rand, krona and franc. The dollar fell 0.6 percent this week to ¥94.38.

The Federal Reserve Bank of Philadelphia’s general economic index climbed to 4.2 from minus 7.5 last month, the bank said on Thursday. Positive readings signal an expansion. The leading US economic indicators rose last month for a fourth consecutive month, the Conference Board reported separately the same day.

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