Asian currencies declined for a third week, led by the Philippine peso and the Indonesian rupiah, on concern China’s plan to restrict industrial production will hold back an economic recovery in the region.
The rupiah had its second weekly decline in more than two months as companies sought US dollars for month-end payments for imports and debt. Most currencies in the region gained on Friday, paring the week’s losses, after better-than-expected US gross domestic product data eased concern that a rebound in exports would falter.
“There’s been concern China might restrict lending, thereby curbing their growth and that will hamper sentiment in the region,” said Gundy Cahyadi, an economist in Singapore at IDEAglobal. “China is after all the driving factor that will bring the countries out of this recession.”
The peso dropped 0.8 percent in the past five days to 48.805 at the 4pm local close in Manila, data from Tullett Prebon PLC show. Indonesia’s currency slid 0.4 percent this week to 10,050 in Jakarta and India’s rupee fell 0.1 percent to 48.665 in Mumbai. The ringgit slid 0.2 percent this week to 3.52.
The New Taiwan dollar fell 0.1 percent in the past week to NT$32.925 on Friday.
The won rose 0.5 percent this week to 1,244.25 in Seoul, climbing yesterday after the nation posted a current-account surplus for a sixth month in July, helped by an increase in overseas shipments as the global economic slowdown eased.
Elsewhere, the Singapore dollar was little changed this week at S$1.4390. The Thai baht was at 34.01, unchanged from last Friday.
The US dollar gained against the euro on Friday on increased demand for safety as a drop in stocks encouraged investors to sell the 16-nation currency to limit losses.
The US dollar gained 0.3 percent to US$1.4294 per euro at 3:37pm in New York on Friday, from US$1.4341 on Thursday. The dollar advanced 0.1 percent to ¥93.60, from ¥93.52. The euro decreased 0.3 percent to ¥133.75, from ¥134.14 on Thursday.
Sterling was the biggest loser against the dollar among major currencies this month on concern the UK’s recession may last longer than in other countries. The Bank of England said on Aug. 6 it would expand its asset-purchase program, pumping money into the economy to stem the economic contraction.
The pound traded at £0.8808 per euro, compared with £0.8809 on Thursday, when it reached £0.8839, the weakest level since June 5. Sterling was at US$1.6280, compared with US$1.6284, and dropped 2.6 percent this month.
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