20000418

Indian rupee

BOMBAY: The Indian rupee ended steady on Monday after dollar sales by the country's largest commercial bank, the State Bank of India (SBI), shielded it from a likely slide in the wake of Friday's US market crash.

The rupee ended at 43.64/6425 per dollar against its previous close of 43.645/65 on Thursday, after trading in a narrow one paise (0.01 rupee) range amid early support from SBI.

Dealers reported a nervous start to the market after the early slide in Asian stockmarkets on the tails of Friday's US market crash.

The technology-laden Nasdaq index plunged 355.49 points or 9.67 percent on Fri64 1708.-Reuters

Chinese yuan

SHANGHAI: China's yuan ended slightly lower against the dollar on Monday as importers maintained their demand for the greenback, dealers said.

The yuan closed at an intraday low of 8.2797 to one dollar against 8.2793 on Friday after moving in a narrow range and touching a high of 8.2790.

"Importers' dollar demand was the key factor to push the yuan down slightly today," said a dealer at a local bank.

"But there is a rough balance of dollar demand and supply on the market, keeping the yuan in a narrow band."

China's imports surged 41 percent year-on-year in the first quarter of this year as the economy showed signs of recovery after two years of deflation.

Gross Domestic Product (GDP) rose a provisional 8.1 percent year-on-year in the first three months of this year, official figures showed. Growth last year stood at 7.1 percent.

China's exports also rose 39.1 percent year-on-year, ensuring a solid trade surplus of $5.22 billion in the first quarter of this year.

Trade is the key factor affecting dollar demand and supply on the Shanghai-based foreign exchange market as China's yuan is not convertible on the current account.

Dealers said they expected the yuan to move in a narrow range of 8.2780 and 8.2800 in the near term.

The yuan closed lower against the Japanese yen at 7.9598 to 100 yen from 7.6850 on Friday. It edged higher against the Hong Kong dollar to 1.0625 from 1.0632.-Reuters

S.Korean won

SEOUL: The South Korean won closed lower against the dollar on Monday hurt as foreign investors in local stocks headed for the exits in the wake of Friday's record point losses on Wall Street, dealers said.

"The won fell as foreign investors increased their sales of local stocks," said a foreign bank dealer. "But the yen's strength against the dollar and unwinding of long dollar positions limited the won's steep fall."

The won closed at 1,113.8 per dollar against on Friday's close of 1,111.2.

It opened at 1,114.0 and moved in a range of 1,113.2 to 1,115.9. Foreign investors were net sellers of 156 billion won worth of local stocks on Monday, brokers said.

The benchmark Korea Composite Stock Price Index (KOSPI) lost a record 11.63 percent to close at 707.72 in a session that was stopped temporarily just four minutes in by a circuit breaker that kicks in if the market goes 10 percent lower and stays there more than a minute.

Trade on the Korea Stock Exchange was halted for 30 minutes in the first such stoppage since the system was introduced in 1998.

Finance Minister Lee Hun-jai urged institutional investors on Monday to refrain from panic selling on the stock market.

"Institutional investors are urged to show their leadership and sense of responsibility for the stabilisation of the market," Lee told a special press conference, arranged after the government cancelled a regular economic ministers' meeting.

The yen was quoted at 103.34/39, compared with 105.85/88 in late Tokyo trading on Friday.

The dollar/won rate is forecast to move between 1,113 and 1,117 on Tuesday, with market players preferring to stay on the sidelines, dealers said. Dealers said expectations that the government would intervene to quell concerns about inflation stemming from the won's depreciation discouraged dollar buying.

"The government should be mindful of the impact that the won's depreciation would have on prices," said one dealer.

The won's fall against the dollar increases the won-denominated price of imports, thus pushing up consumer prices.

Dealers said long-dollar holders unloaded their positions, taking advantage of the dollar's rise.

In the non-deliverable forward trading, the six-month won was quoted at 1,114.7/15.7, while the one-year won stood at 1,117.4/18.4.-Reuters

Taiwanese dollar

TAIPEI: The Taiwan dollar closed softer against the US dollar on Saturday as a 5.42 percent decline in the domestic stock market eroded confidence in the currency market.

Currency dealers said the market feared foreign funds, which have turned net sellers in Taiwan's stock market, would repatriate their funds home, weakening the Taiwan dollar.

CLOSE: T$30.49 to the US dollar, down from on Friday's close at T$30.460. On the smaller Cosmos market, the Taiwan currency also ended lower at T$30.502 against its close of T$30.462 on Friday.

TURNOVER THROUGH DEALERS: heavy at US$204 million for Saturday's shortened half-day trade, compared with US$582 million on Friday. Cosmos turnover was a light US$34 million, compared with on Friday's US$101.5 million.

The Taiwan dollar opened slightly up at T$30.456 to the US dollar but began to reverse course and dipped to an intraday low of T$30.5 as share prices plunged.

"Continued foreign fund outflows intensified the Taiwan dollar's downward pressure," said one dealer at a foreign fund trustee bank.

More outflows were expected if stock woes in Taiwan and the United States deepened, dealers said.

In one of the most dramatic slides in history, Wall Street's three major stock indices logged their biggest one-day point declines on Friday.

The TAIEX closed at 8,866.80, down 507.81 points, or 5.42 percent on Saturday.

Dealers said the central bank appeared to have defended the Taiwan dollar at around the T$30.5 level. But they said the Taiwan dollar likely would test T$30.6 next week if the stock market showed no signs of rebounding.-Reuters

Philippine peso

MANILA: The Philippine peso recovered from an 18-month low to end just slightly weaker against the dollar on Monday despite the shockwaves sent by the carnage on Wall Street.

The local unit ended at 41.19 per dollar, its strongest level for the day, from the close of 41.17 on Friday.

Dealers said the lack of corporate demand for dollars did not sustain the weakness in the peso. The peso plunged to 41.27 in the first hour of trade, its weakest level since 41.65 in October 1998.

"I think it was just a knee-jerk reaction. Towards mid-day, people realised that there is no corporate (dollar) demand at those high levels, so they squared off their positions towards closing," a dealer with a local bank said.

Another dealer said: "Regional currencies did not move as much. The yen is even stronger, then baht is still below 38 level, and there's little corporate demand here so there's no reason for the peso to be that weak." Dealers earlier said the peso was biased to weaken since the higher-than-expected US inflation figure, which spooked US stock markets on Friday, could trigger a substantial interest rate hike, and thus pressure the peso.

But central bank governor Rafael Buenaventura said the peso's weakness was only temporary, adding the central bank was not likely to raise its key overnight rates to protect the peso from further depreciating.

"It's only temporary, and anyway, all regional currencies are feeling this temporary pressure," Buenaventura told reporters.

Nevertheless, the auction of Treasury bills on Monday reflected the nervousness in the domestic market.

The benchmark 91-day T-bill rate dropped, but the 182-day and 364-day rates moved higher.

"I think this is a clear reaction to that what's happening internationally and of course what's happening to the foreign exchange rate," Deputy Treasurer Eduardo Mendiola told reporters.

Dealers said the peso could still recover on Tuesday, but they said its upside was limited because corporate dollar orders were strong at the 41.15 level.

"The really strong demand is at 41.08/41.10, but at 41.15 the demand is fairly strong, so I think the dollar will be supported at that level," a dealer with a local bank said.

Dealers said banks were also expected to take long dollar positions on Wednesday due to the long weekend.

Philippine markets are closed on Thursday and Friday because of the Easter holidays.

"If ever the peso would be stronger, it's probably only in the morning. There's a long weekend ahead so most banks would choose to take long dollar positions given the current scenario," the local dealer said.

Two dealers placed the immediate trading range at 41.15 to 41.25 until on Wednesday, while another gave a wider range of 41.05 to 41.30.-Reuters

Indonesian rupiah

JAKARTA: A sharp fall in the Jakarta share market to a more than six month low wiped out recent modest gains in the rupiah on Monday.

The rupiah was quoted at 7,660/7,675 to the dollar compared with 7,610/7,620 in late local trade on Friday.

Some large state-owned banks were selling dollars in the market, on behalf of some government agencies, but the volume was too small to have any impact when the sentiment was so much against the rupiah, one US bank dealer said.

"Bank BRI is in the market again today, but they seem to have less dollars now to sell in the market," the dealer said.

The state-owned BRI had been aggressively selling dollars recently, believed to be on behalf of state commodities regulator Bulog, he said.

The rupiah had strengthened to briefly break 7,600 last week after the country's official creditors agreed to reschedule $5.8 billion dollar in foreign debts.

Dealers, however, said trading was relatively slow on Monday. The rupiah was traded in a 7,645 to 7,680 range most of the day.

"Players are unwilling to open new positions because of (interest) rate worries and sharp falls on the stock markets," one bank dealer said.

She said the swaps market continued to be thin amid concerns over narrowing interest rate differentials against the dollar.

Dealers said immediate support for the rupiah seen at around 7,700 while resistance was seen at 7,600.

Bank Indonesia said 6.2 trillion in rupiah funds matured early on Monday.-Reuters