Asian currencies eased against the dollar over the previous week as the prospect of further interest rate hikes in the US was revived by Federal Reserve officials.
The yen also eased amid a bout of nerves ahead the upcoming meeting of the Group of Seven finance ministers and central bankers while the greenback drew strength from hawkish comments by San Francisco Fed chief Janet Yellen.
"The bottom line is this: With inflation too high, policy must have a bias toward further firming," said Yellen, who is normally seen as one of the less hawkish members of the US central bank.
However most analysts expect the Fed to keep its policy unchanged over the months ahead. After 17 consecutive hikes, the central bank last month kept US rates steady.
Further support for the greenback came from US Treasury Secretary Henry Paulson, who told students in Hanoi: "I'm very much in favour of a strong dollar because we believe that is in our nation's interest."
JAPANESE YEN: The yen eased after rallying against the dollar early in the week and it is expected to be locked in nervous trading ahead of an upcoming meeting of Group of Seven (G7) finance ministers and central bankers.
The Japanese currency stood at 116.26-29 to the dollar late Friday, up from 117.36-39 to the dollar a week earlier.
It hit the week's high of 115.57 to the dollar on Tuesday on speculation that the Bank of Japan might raise interest rates again before the end of the year. But the yen fell back to touch 116.98 to the dollar at one point on Thursday.
It was buoyed up on Friday after Germany's deputy finance minister, Thomas Mirow, said in Berlin that the G7 meeting in Singapore on September 16 would "surely" discuss the yen's weakness seen in "several months."
"Noise will emerge ahead of the G7 meeting," said Mitsuru Sahara, senior forex manager at Bank of Tokyo-Mitsubishi UFJ, adding that the "dollar-yen will not be the main topic and the US side will not comment on the issue."
Bank of Japan governor Toshihiko Fukui said Friday his bank would continue to raise interest rates slowly in light of economic developments.
"Market expectations have leaned towards hawkish comments from Fukui and the yen is expected to move higher," Resona Bank client manager Kenichi Iguchi said before the central bank governor made the comment.
AUSTRALIAN DOLLAR: The Australian dollar is expected to remain range-bound next week as expectations fade of an interest rate rise before the end of the year, dealers said.
The Australian dollar was trading at 75.74 US cents Friday, well down on the previous week's 76.44 US cents.
National Australia Bank (NAB) currency strategist John Kyriakopoulos said lower-that-expected June quarter economic growth had dampened expectations of a rate rise, halting the local currency's upward momentum.
"The data really did not add to the case for a rate hike which has been weighing on the currency," he said.
The central bank last Wednesday left interest rates on hold at 6.0 percent after a 0.25 point rise in August.
Kyriakopoulos said scheduled addresses by a number of US Federal Reserve chiefs next week were unlikely to impact on the markets.
"The market has already priced in a soft landing for US growth, so if they don't change their tune, I don't see much of an impact on currencies," he said.
NEW ZEALAND DOLLAR: The New Zealand dollar ended the week at 63.95 US cents, down sharply from 65.54 cents the previous Friday. The kiwi lost ground against a resurgent US dollar during the week and it dipped further Friday on comments from Finance Minister Michael Cullen that the high exchange rate was a risk to the New Zealand economy.
"A stronger US dollar, euro's weaker, your Aussie's weaker and then soft building data and some comments from Cullen contributed to putting the skids under it," said Mark Elliot, a senior dealer with ANZ Investment Bank.
Data showed the value of residential building work had dropped a seasonally adjusted 9.1 percent over the June quarter.
The kiwi has been in retreat as traders looked for opportunities to lock in profits from the latest rally which drove it up to six-month highs on Monday.
CHINESE YUAN: The yuan ended Friday at 7.9485 to the dollar on the exchange-traded market, compared with the closing price of 7.9410 on the previous day and 7.9532 a week before, traders said.
Friday's central parity rate for the yuan was set at 7.9568 to the dollar.
The People's Bank of China has a daily yuan-dollar trading band of 0.3 percent on either side of the midpoint.
HONG KONG DOLLAR: The US-dollar pegged Hong Kong dollar closed the week nearly unchanged at 7.7766, from the previous week's close of 7.7765.
INDONESIAN RUPIAH: The Indonesian rupiah finished the week at 9,120/9,125 to the dollar, down from a close of 9,090-9,095 on September 1.
PHILIPPINE PESO: The Philippine peso strengthened further to 50.49 to the dollar on Friday, from 50.735 to the dollar the previous week.
SINGAPORE DOLLAR: The Singapore dollar was at 1.5692 Singapore dollars from 1.5728 the previous week.
SOUTH KOREAN WON: The won closed at 956.30 won per dollar Friday, compared with 960.50 won a week earlier.
Dealers said the won-dollar exchange rate was likely to find a technical support at 955 won amid expectations for a possible government intervention.
But the dollar-won exchange rate could fall below 955 should the yen's recent weakness become a major issue at the upcoming Group of Seven finance ministers' meeting in Singapore, dealers said.
TAIWAN DOLLAR: The Taiwan dollar rose 0.01 percent during the week to close at 32.880 against the US dollar, against 32.884 a week earlier.
THAI BAHT: The Thai baht held firm against the dollar over the past week in line with gains in the yuan, which continued to rise against the greenback amid speculations that China wants greater currency flexibility, dealers said.
The Thai currency closed Friday at 37.42-44 to the dollar, up from 37.49-53 a week earlier.
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