Asian currencies fell this week, led by the South Korean won and Indian rupee, as emerging markets took a beating after Dubai sought to delay debt payments, bolstering demand for safety in US Treasuries and the US dollar.
The MSCI Asia-Pacific Index of local shares slumped to the lowest level in almost eight weeks. The greenback rose against 15 of 16 major currencies on Friday after state-owned Dubai World, with US$59 billion of liabilities, requested a “standstill” agreement from creditors. The Philippine peso dropped after data on Thursday showed third-quarter growth fell short of analysts’ estimates.
“Dubai prompted a wave of risk aversion globally,” said Mitul Kotecha, Hong Kong-based head of global foreign-exchange strategy at Calyon, the investment-banking unit of France’s Credit Agricole SA. “We see Asian currencies a bit vulnerable in this environment. It’s not going to be a huge fallout because Asia looks more solid in terms of fundamentals.”
The won on Friday dropped 1.7 percent to 1,175.35 per US dollar and was down 1.4 percent on the week, the biggest loss in five, according to data compiled by Bloomberg. India’s rupee declined 0.4 percent to 46.6387 and fell 0.01 percent from Nov. 20. Markets in Indonesia, Singapore and Malaysia were closed on Friday.
South Korea’s financial companies were owed a combined US$32 million from Dubai World and its property unit Nakheel PJSC as of the end of September, the MoneyToday newspaper reported, citing the nation’s financial regulator.
The New Taiwan dollar dropped 0.3 percent this week to NT$32.345.
The Philippine peso declined 0.8 percent in Manila on Friday to 47.205 and lost 0.3 percent for the week.
Thailand’s baht was down 0.1 percent from the end of last week at 33.26 per dollar. The Malaysian ringgit declined 0.2 percent to 3.3910 and Indonesia’s rupiah fell 0.7 percent to 9,535 from a week ago. The Singapore dollar dropped 0.1 percent to S$1.3897.
The US dollar dropped to the lowest level versus the yen since July 1995 and fell against the euro as the Federal Reserve’s signal that it would tolerate a weaker greenback encouraged investors to buy higher-yielding assets outside the US.
The US currency touched as low as ¥84.83 on Friday, the weakest in 14 years, spurring speculation Japan would intervene to curtail gains in its currency. For the week, the greenback fell 2.6 percent to ¥86.57, the fifth consecutive weekly decline.
The greenback declined 0.7 percent to US$1.4962 per euro from US$1.4862 last Friday. The yen rose 2 percent to ¥129.41 per euro, from ¥132.09. The US currency fell 2.8 percent to ¥86.49, from ¥88.88.
The US dollar has depreciated 7 percent against the euro, 4.5 percent against the yen and 13 percent versus the pound this year.
MORE VISITORS: The Tourism Administration said that it is seeing positive prospects in its efforts to expand the tourism market in North America and Europe Taiwan has been ranked as the cheapest place in the world to travel to this year, based on a list recommended by NerdWallet. The San Francisco-based personal finance company said that Taiwan topped the list of 16 nations it chose for budget travelers because US tourists do not need visas and travelers can easily have a good meal for less than US$10. A bus ride in Taipei costs just under US$0.50, while subway rides start at US$0.60, the firm said, adding that public transportation in Taiwan is easy to navigate. The firm also called Taiwan a “food lover’s paradise,” citing inexpensive breakfast stalls
TRADE: A mandatory declaration of origin for manufactured goods bound for the US is to take effect on May 7 to block China from exploiting Taiwan’s trade channels All products manufactured in Taiwan and exported to the US must include a signed declaration of origin starting on May 7, the Bureau of Foreign Trade announced yesterday. US President Donald Trump on April 2 imposed a 32 percent tariff on imports from Taiwan, but one week later announced a 90-day pause on its implementation. However, a universal 10 percent tariff was immediately applied to most imports from around the world. On April 12, the Trump administration further exempted computers, smartphones and semiconductors from the new tariffs. In response, President William Lai’s (賴清德) administration has introduced a series of countermeasures to support affected
CROSS-STRAIT: The vast majority of Taiwanese support maintaining the ‘status quo,’ while concern is rising about Beijing’s influence operations More than eight out of 10 Taiwanese reject Beijing’s “one country, two systems” framework for cross-strait relations, according to a survey released by the Mainland Affairs Council (MAC) on Thursday. The MAC’s latest quarterly survey found that 84.4 percent of respondents opposed Beijing’s “one country, two systems” formula for handling cross-strait relations — a figure consistent with past polling. Over the past three years, opposition to the framework has remained high, ranging from a low of 83.6 percent in April 2023 to a peak of 89.6 percent in April last year. In the most recent poll, 82.5 percent also rejected China’s
PLUGGING HOLES: The amendments would bring the legislation in line with systems found in other countries such as Japan and the US, Legislator Chen Kuan-ting said Democratic Progressive Party (DPP) Legislator Chen Kuan-ting (陳冠廷) has proposed amending national security legislation amid a spate of espionage cases. Potential gaps in security vetting procedures for personnel with access to sensitive information prompted him to propose the amendments, which would introduce changes to Article 14 of the Classified National Security Information Protection Act (國家機密保護法), Chen said yesterday. The proposal, which aims to enhance interagency vetting procedures and reduce the risk of classified information leaks, would establish a comprehensive security clearance system in Taiwan, he said. The amendment would require character and loyalty checks for civil servants and intelligence personnel prior to