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Tuesday May 13, 11:58 AMEmerging FX-Asia mostly down, but Singapore dollar risesSINGAPORE, May 13 (Reuters) - Most Asian currencies fell on Tuesday amid worries about a global slowdown, but investors bought the Singapore dollar on expectations it would rebound against the U.S. dollar as the Singapore government fights inflation.The Singapore dollar rose as far as 1.3637 to the U.S. dollar, up about 0.4 percent from late Asian trade on Monday. Traders said its near-term outlook would hinge on the U.S. dollar, which held steady against the Japanese yen and euro on Tuesday. "There was some unwinding last week so it should not be as volatile now, but players might start loading positions (in the Singapore dollar) again, thinking that the whole episode is over," said a Singapore-based trader, referring to the U.S. dollar's recent rally. Many investors expect the Singapore dollar to rise further, on top of a gain of 5.2 percent versus the U.S. dollar so far this year, because of the government's battle against inflation. The Malaysian ringgit pulled back to around 3.22 per dollar after going as high as 3.199. The South Korean won hovered near 1,046 per dollar, down about 0.4 percent from late Asian trade on Friday. Markets in South Korea were closed on Monday for a holiday. Tim Condon, head of Asia research at ING, said he believed the won's decline -- amounting to just over 10 percent versus the dollar so far this year -- was overdone. But he cautioned that investors should not be betting on a won recovery yet because the rhetoric from policy makers seemed to suggest they wanted to see the won weaker. "Getting in the way of it seems like a dangerous strategy," he said. Elsewhere, the Chinese yuan fell as far as 6.9949 per dollar, down a tenth of a percent from Monday's close, after a strong earthquake on Monday in the southwestern province of Sichuan, where the death toll neared 10,000. But analysts still expect further yuan gains as Beijing tries to tame inflation, which accelerated to 8.5 percent in April. Analysts at UBS maintained their forecast that the yuan would rise to 6.58 per dollar by the end of 2008. "We think this week's data-set could signal to the market that the policy of allowing the yuan to appreciate by around 10 percent per annum is still valid despite the static renminbi (yuan) in April," they said in a note. On Monday China posted a solid trade surplus of $16.7 billion for April, despite the U.S. economic slowdown. Also on Monday, China's central bank raised banks' reserve requirements for the fourth time this year to mop up liquidity. CURRENCIES VS U.S. DOLLAR Change on the day at 0303 GMT Currency Latest bid Previous day Pct Move Japan yen 103.79 103.75 -0.04 Sing dlr 1.3663 1.3694 +0.23 Taiwan dlr 30.890 30.850 -0.13 Korean won 1046.20 1041.40 -0.46 Baht 32.25 32.15 -0.31 Peso 42.72 42.66 -0.15 Rupiah 9257.00 9250.00 -0.08 Ringgit 3.2195 3.2150 -0.14 Yuan 6.9918 6.9882 -0.05 Change so far in 2008 Currency Latest bid End prev year Pct Move Japan yen 103.79 111.33 +7.26 Sing dlr 1.3663 1.4382 +5.26 Taiwan dlr 30.890 32.443 +5.03 Korean won 1046.20 935.70 -10.56 Baht 32.25 33.68 +4.43 Peso 42.72 41.28 -3.37 Rupiah 9257.00 9390.00 +1.44 Rupee 42.05 39.41 -6.27 Ringgit 3.2195 3.3050 +2.66 Yuan 6.9918 7.3041 +4.47 (Reporting by Kevin Yao; Editing by Alan Raybould) |
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