Thailand’s baht and Indonesia’s rupiah gained the most this week among Asian currencies as the Group of Seven nations agreed to sell yen to calm currency markets roiled in the aftermath of Japan’s biggest earthquake.
The Bloomberg-JPMorgan Asia Dollar Index climbed for a second day yesterday, trimming a loss for the week to 0.3 percent. The gauge sank to a three-week low on March 16 as uncertainty caused by the temblor and ensuing tsunami and nuclear crisis sapped demand for emerging-market assets. The yen snapped a five-day rally yesterday that was fueled by speculation Japanese investors and companies were repatriating funds to cope with the disaster.
“Markets are reacting positively to the intervention news and signs of support from the G-7 is reassuring investors,” said Brian Jackson, an emerging-markets strategist at Royal Bank of Canada in Hong Kong. “We see risk appetite coming back, not just in the currencies but in equities as well.”
Thailand’s baht strengthened 0.5 percent this week to 30.32 per dollar in Bangkok, according to data compiled by Bloomberg. The rupiah advanced 0.3 percent to 8,773 and India’s rupee rose 0.2 percent to 45.1425.
“At the request of the Japanese authorities, the U.S., the U.K., Canada, and the European Central Bank will join with Japan, on March 18, in concerted intervention in exchange markets,” the G-7 said in a statement yesterday.
“Thailand’s yield premiums attracted fund inflows, supporting the baht,” said Tohru Nishihama, an economist at Dai-ichi Life Research Institute Inc. in Tokyo.
Indonesia’s rupiah climbed yesterday, trading near the strongest level in almost four years, on speculation the central bank will allow the currency to gain to tackle inflation.
Offshore funds increased holdings of Indonesia’s government debt by 2.6 percent to 205.7 trillion rupiah ($23.4 billion) this month through March 16, according to official data. Consumer prices in Southeast Asia’s largest economy increased 6.84 percent in February from a year earlier, compared with a 7.02 percent rise in January, the most since April 2009.
“The central bank has said it will allow currency appreciation to help combat imported inflation,” said Wellian Wiranto, an economist at HSBC Holdings Plc in Singapore.
Security forces clashed with anti-government protesters in Bahrain this week, leaving two demonstrators and two police officers dead, and Libya’s air force bombed rebels. The United Nations Security Council authorized the use of air attacks and a no-fly zone over Libya to protect civilians from forces loyal to Qaddafi.
The Gulf region accounts for about 30 percent of overseas remittances, central bank Governor Amando Tetangco said this month.
The peso declined 0.1 percent this week to 43.705 per dollar, according to Tullett Prebon Plc. It touched 44.01 on March 17, the weakest level since Feb. 2.
Elsewhere, Taiwan’s dollar was little changed this week at NT$29.60. South Korea’s won and Malaysia’s ringgit both dropped 0.2 percent to 1,126.65 and 3.0530 respectively. China’s yuan gained 0.1 percent to 6.5691 and Singapore’s dollar retreated 0.2 percent to S$1.2766.
The Bloomberg-JPMorgan Asia Dollar Index climbed for a second day yesterday, trimming a loss for the week to 0.3 percent. The gauge sank to a three-week low on March 16 as uncertainty caused by the temblor and ensuing tsunami and nuclear crisis sapped demand for emerging-market assets. The yen snapped a five-day rally yesterday that was fueled by speculation Japanese investors and companies were repatriating funds to cope with the disaster.
“Markets are reacting positively to the intervention news and signs of support from the G-7 is reassuring investors,” said Brian Jackson, an emerging-markets strategist at Royal Bank of Canada in Hong Kong. “We see risk appetite coming back, not just in the currencies but in equities as well.”
Thailand’s baht strengthened 0.5 percent this week to 30.32 per dollar in Bangkok, according to data compiled by Bloomberg. The rupiah advanced 0.3 percent to 8,773 and India’s rupee rose 0.2 percent to 45.1425.
“At the request of the Japanese authorities, the U.S., the U.K., Canada, and the European Central Bank will join with Japan, on March 18, in concerted intervention in exchange markets,” the G-7 said in a statement yesterday.
Thai Yield Premium
Thailand’s baht advanced as the nation’s yield premium over developed economies spurred overseas investors to add to holdings of its debt. Global funds bought $109 million more local bonds than they sold this week through to March 17, according to data from the Thai Bond Market Association. The nation’s 2.5 percent benchmark interest rate compares with a maximum of 0.25 percent in Japan and the U.S.“Thailand’s yield premiums attracted fund inflows, supporting the baht,” said Tohru Nishihama, an economist at Dai-ichi Life Research Institute Inc. in Tokyo.
Indonesia’s rupiah climbed yesterday, trading near the strongest level in almost four years, on speculation the central bank will allow the currency to gain to tackle inflation.
Offshore funds increased holdings of Indonesia’s government debt by 2.6 percent to 205.7 trillion rupiah ($23.4 billion) this month through March 16, according to official data. Consumer prices in Southeast Asia’s largest economy increased 6.84 percent in February from a year earlier, compared with a 7.02 percent rise in January, the most since April 2009.
“The central bank has said it will allow currency appreciation to help combat imported inflation,” said Wellian Wiranto, an economist at HSBC Holdings Plc in Singapore.
Middle East Concern
The Philippine peso dropped to a six-week low on March 17 on concern political tension in the Middle East will spur an exodus of Filipino workers from the region, hurting remittances. The currency declined for a second week.Security forces clashed with anti-government protesters in Bahrain this week, leaving two demonstrators and two police officers dead, and Libya’s air force bombed rebels. The United Nations Security Council authorized the use of air attacks and a no-fly zone over Libya to protect civilians from forces loyal to Qaddafi.
The Gulf region accounts for about 30 percent of overseas remittances, central bank Governor Amando Tetangco said this month.
The peso declined 0.1 percent this week to 43.705 per dollar, according to Tullett Prebon Plc. It touched 44.01 on March 17, the weakest level since Feb. 2.
Elsewhere, Taiwan’s dollar was little changed this week at NT$29.60. South Korea’s won and Malaysia’s ringgit both dropped 0.2 percent to 1,126.65 and 3.0530 respectively. China’s yuan gained 0.1 percent to 6.5691 and Singapore’s dollar retreated 0.2 percent to S$1.2766.
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