Wednesday, 13 August 2008
UOB Economic-Treasury Research
Company Reg No. 193500026Z
Asian currencies lost ground on Tue as the USD remained
firm on falling commodities prices while authorities appeared
to be absent after a bout of dollar selling on Mon. Aside
from China's releases of retail sales and monetary data, lack
of clear lead likely to keep Asian units sideways against the
USD for now. Thai financial markets will reopen today after
closing for public holiday on Tue.
In Asian trade on Tue, PHP led Asian units' decline, ending
at nearly 0.5% lower to 44.60/USD Tue from 44.38 close
on Mon. MYR eased 0.3% to 3.3265/USD compared with
Monday's closing of 3.3160, coming off for the sixth straight
day against the USD. IDR was unchanged at 9175/USD.
Elsewhere, TWD inched lower to 31.189/USD from 31.166
on Mon, extending a 11-day run of losses despite
speculation the central bank will intervene to support the
currency. KRW eased to 1,034.75/USD, vs. Monday's close
of 1,031.9 though concerns of further dollar selling by BoK
kept the domestic unit supported.
USD/SGD moved in a choppy trade early on Tue before a
spike up to test 1.4140 in Asian session but retraced to 1.4100
price level later as the sharp move could trigger authorities'
attention. In late session, the SGD traded near 1.4084/USD
Tue, 0.3% firmer compared to 1.4130 late Mon. With USD
remaining firm, The USD/SGD pair is likely to remain
supported. The SGD NEER continued to stay on the weaker
side of the midpoint, hovering near 0.14% below the parity.
The trade-weighted S$ should remain bounded between the
0.0% to -0.5% range for now, which implies a range of
1.4061-1.4132 for the pair for now.
RMB ended lower at 6.8632/USD from Monday's close of
6.8577, tracking weaker Asian units as well as a lower
central parity. The central parity was set lower for a 10th
straight day on Tue, at 6.8659/USD, vs. 6.8638 a day earlier.
Offshore 1Y NDF lowered further expectations of RMB
appreciation after th