BLBG:Asian Currencies Advance as U.S. Data Improves Export Outlook
Asian currencies strengthened, led by Taiwan’s dollar, as signs the U.S. economic recovery is gaining momentum brightened the region’s export outlook.
The Bloomberg-JPMorgan Asia Dollar Index (MXAP) rose for a second day after a report yesterday showed new homes in the U.S. were sold at a 328,000 annual rate in March, more than the 319,000 projection in a Bloomberg survey. South Korea’s consumer confidence was at 104 in April, the highest in 11 months, a central bank report showed today, while Thai exports gained for a second month in March after three months of declines, according to a Bloomberg survey before data due tomorrow.
“The U.S. recovery is adding to confidence that export- oriented Asian countries will benefit from firmer growth,” said Yeah Kim Leng, chief economist at RAM Holdings Bhd. in Kuala Lumpur. “That has helped to shore up Asian currencies.”
The Taiwan dollar climbed 0.2 percent to NT$29.479 against the greenback as of 10 a.m. local time, according to Taipei Forex Inc. South Korea’s won strengthened 0.1 percent to 1,139.80, the Philippine peso added 0.1 percent to 42.667 and China’s yuan rose 0.05 percent to 6.3041. The Asia Dollar Index, which tracks the region’s 10 most active currencies excluding the yen, advanced 0.03 percent to 116.52.
The MSCI Asia-Pacific Index of shares rose, snapping a four-day loss, after yields on Spanish and Dutch bonds fell following auctions. The Federal Reserve will release its forecasts for interest rates, economic growth and inflation in the world’s largest economy today.
Faster Inflation
Taiwan’s dollar advanced the most this month on speculation the central bank will tolerate faster appreciation to tame inflation. Taiwan Power Co., the island’s only electricity retailer, said on April 12 it will increase prices for the first time in more than three years after posting losses on rising fuel costs. Consumer prices rose 1.21 percent in March from a year earlier after climbing 0.23 percent in February, official data show.
“Gains in the Taiwan dollar will help ease imported inflation,” said Eric Hsing, a fixed-income trader at First Securities Inc. in Taipei.
The won rebounded from a one-week low and the Kospi Index of shares rose for the first time in five days as exchange data showed overseas investors bought more Korean equities than they sold for a second day today.
“With positive news coming out from the U.S. and European bond auctions going well, the won faces upward pressure,” said Jeon Seung Ji, a Seoul-based currency analyst at Samsung Futures Inc. “Still, with the U.S. monetary policy meeting results announced today, market movements won’t be big.”
Elsewhere, Indonesia’s rupiah strengthened 0.1 percent to 9,183 per dollar. Thailand’s baht and Malaysia’s ringgit were little changed at 30.96 and 3.0647, respectively, while Vietnam’s dong dropped 0.5 percent to 20,860.
To contact the reporters on this story: Yumi Teso in Bangkok at yteso1@bloomberg.net; Liau Y-Sing in Kuala Lumpur at yliau@bloomberg.net
To contact the editor responsible for this story: Sandy Hendry at shendry@bloomberg.net.
