Asian currencies declined this week after reports in Taiwan, Malaysia, the Philippines and China showed exports slumped as the global slowdown reduced consumer spending overseas.
South Korea’s won led the losses after the central bank cut its benchmark interest rate to a record on Thursday to revive an economy headed for the first recession in more than a decade. Investor appetite for riskier emerging-market assets has faded this year, sending eight of the 10 most-active Asian currencies lower against the US dollar. A regional gauge of stocks has dropped more than 8 percent this year.
“Most Asian currencies will continue to weaken at least through to the middle of this year,” said David Mann, senior foreign-exchange strategist at Standard Chartered PLC in Hong Kong. “The worsening data in the region are likely to keep policy makers comfortable with seeing some weakness in their exchange rates.”
The New Taiwan dollar declined 0.9 percent this week to NT$34.05, near the weakest level since 2004.
The won declined 1.5 percent for the week to 1,404.20 per dollar, according to Seoul Money Brokerage Services. Indonesia’s rupiah fell 0.7 percent this week to 11,760.
The MSCI Asia-Pacific Index of regional shares lost 2 percent this week, snapping a two-week gain.
The peso rose 0.4 percent to 47.115 a dollar on Friday in Manila for a five-day gain of 0.2 percent, according to Tullett Prebon PLC.
The Philippine currency may still weaken to 49 by the end of the quarter as exports and remittances from Filipinos working abroad falter, said Radhika Rao, an economist at IDEAglobal Ltd in Singapore.
The yen had its first weekly gain versus the euro in three weeks, trading at ¥117.96 from ¥118.85 a week ago. The dollar traded at ¥91.41 from ¥91.89 last week.
Elsewhere, the Thai baht depreciated 0.4 percent for the week to 35.14 and Malaysia’s ringgit dropped 0.3 percent to 3.6055 per US dollar. India’s rupee strengthened 0.08 percent to 48.6538, from 48.6950 a week ago. Vietnam’s dong was little changed at 17,484.5.
“Our outlook for the Taiwan dollar is still weak,” said Thio Chin Loo, senior currency strategist at BNP Paribas in Singapore. Regarding the US stimulus plan, she said “the situation is still gloomy, which supports the dollar against Taiwan.”
The euro slipped slightly against the US dollar on Friday after dismal eurozone data and as G7 finance chiefs began a two-day meeting on the spreading global financial crisis.
The euro was at US$1.2856 at 10pm GMT after US$1.2861 late on Thursday in New York.
The euro spent the week trading in a narrow band around US$1.30.
“Any sign of optimism that is able to bubble up in the markets recently has been consistently battered down by fading returns and the constant sense of risk looming over investors heads,” John Kicklighter at Forex Capital Markets said.
In late New York trading, the US dollar fell to 1.1622 Swiss francs from SF1.1630 late on Thursday.
The pound rose to US$1.4349 from US$1.4266.
Super Typhoon Kong-rey is the largest cyclone to impact Taiwan in 27 years, the Central Weather Administration (CWA) said today. Kong-rey’s radius of maximum wind (RMW) — the distance between the center of a cyclone and its band of strongest winds — has expanded to 320km, CWA forecaster Chang Chun-yao (張竣堯) said. The last time a typhoon of comparable strength with an RMW larger than 300km made landfall in Taiwan was Typhoon Herb in 1996, he said. Herb made landfall between Keelung and Suao (蘇澳) in Yilan County with an RMW of 350km, Chang said. The weather station in Alishan (阿里山) recorded 1.09m of
NO WORK, CLASS: President William Lai urged people in the eastern, southern and northern parts of the country to be on alert, with Typhoon Kong-rey approaching Typhoon Kong-rey is expected to make landfall on Taiwan’s east coast today, with work and classes canceled nationwide. Packing gusts of nearly 300kph, the storm yesterday intensified into a typhoon and was expected to gain even more strength before hitting Taitung County, the US Navy’s Joint Typhoon Warning Center said. The storm is forecast to cross Taiwan’s south, enter the Taiwan Strait and head toward China, the Central Weather Administration (CWA) said. The CWA labeled the storm a “strong typhoon,” the most powerful on its scale. Up to 1.2m of rainfall was expected in mountainous areas of eastern Taiwan and destructive winds are likely
The Central Weather Administration (CWA) yesterday at 5:30pm issued a sea warning for Typhoon Kong-rey as the storm drew closer to the east coast. As of 8pm yesterday, the storm was 670km southeast of Oluanpi (鵝鑾鼻) and traveling northwest at 12kph to 16kph. It was packing maximum sustained winds of 162kph and gusts of up to 198kph, the CWA said. A land warning might be issued this morning for the storm, which is expected to have the strongest impact on Taiwan from tonight to early Friday morning, the agency said. Orchid Island (Lanyu, 蘭嶼) and Green Island (綠島) canceled classes and work
KONG-REY: A woman was killed in a vehicle hit by a tree, while 205 people were injured as the storm moved across the nation and entered the Taiwan Strait Typhoon Kong-rey slammed into Taiwan yesterday as one of the biggest storms to hit the nation in decades, whipping up 10m waves, triggering floods and claiming at least one life. Kong-rey made landfall in Taitung County’s Chenggong Township (成功) at 1:40pm, the Central Weather Administration (CWA) said. The typhoon — the first in Taiwan’s history to make landfall after mid-October — was moving north-northwest at 21kph when it hit land, CWA data showed. The fast-moving storm was packing maximum sustained winds of 184kph, with gusts of up to 227kph, CWA data showed. It was the same strength as Typhoon Gaemi, which was the most
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