The currencies of Singapore, South Korea and Taiwan fell on Monday with the yen, which took a beating as investors bet that an end to Japan's ultra-loose monetary policy would not hurt the dollar's yield advantage.
The Singapore dollar, South Korean won and Taiwan dollar each lost as much as 0.4 percent. The yen dropped as much as 0.8 percent from late Asian trading on Friday to around 117.15 per dollar.
The Singapore dollar, which hit a 7-1/2-year high of 1.6127 on Friday, retreated during the day.
It was pressured by concerns the central bank was unlikely to allow further gains, as analysts estimated it was near the top of the secret range within which the Monetary Authority of Singapore manages the trade-weighted currency.
"While the Singapore dollar has been pushing stronger, the data in Singapore has actually printed a tad weaker," Swiss bank UBS said in a report.
"While we still see the Singapore dollar gaining in the medium term, we think broad US dollar downside will now need to be a very large part of the success on a short dollar/Sing dollar trade."
The Thai baht fell as much as half a percent to 38.9 per dollar in early trading as uncertainty surrounding Prime Minister Thaksin Shinawatra's call for a snap poll increased following a 60,000-strong protest rally in Bangkok on Sunday.
Dealers said political unrest could scare away investors and hurt government's plans for massive infrastructure spending.
Although the baht pared back most of the losses by the end of the day in thin, choppy trade, dealers said the uncertainty was a likely cap on gains.
As demonstrations continued on Monday, another baht trader said there was talk that the April elections may not be held.
"The politics is still unclear," said a baht dealer in Bangkok. "If the political situation continues like this it may be hard for the government to prop up the economy.
The Philippine peso hit a new 3-1/2-year high on Monday after the government said its January budget deficit was 26 percent below target, fuelling speculation that its improving fiscal health could lead to a credit rating upgrade.
Dealers said the peso has also benefited after President Gloria Macapagal Arroyo ended a state of emergency on Friday.
The peso climbed to 51.045 per dollar, a quarter of a percent stronger than at the close of trading on Friday.
The government said it expects the fiscal deficit to fall to 2.1 percent of gross domestic product this year, from 2.8 percent of GDP in 2005.
"It's sending good signals that the government is managing its deficit well," said a chief dealer in a Manila-based bank.
"We see the peso going higher on expectations that if this continues, then there may be a credit rating upgrade down the road," he said.
He said the peso could hit 50 per dollar in the coming months. April and May are usually bullish for the peso as many Filipinos living abroad send money home at this time of the year to fund their children's education in the new academic session.
Still, banks acting of behalf of the central bank were seen buying dollars to smooth the peso's rise, dealers said.
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