Asian currencies ended the week mixed against the dollar as fresh worries about the health of the US economy hit risk appetite and attracted investors to the "safe-haven" greenback, dealers said.
JAPANESE YEN: The yen lost ground this week as a smaller-than-expected improvement in Japanese business confidence disappointed the market, dealers said.
The Japanese currency stood at 96.09 against the dollar in Tokyo on Friday, compared with 95.22 in New York a week earlier. US financial markets were closed in New York on Friday for a public holiday ahead of the July 4 Independence Day celebrations. The Bank of Japan said in its quarterly Tankan survey on Wednesday that business confidence among major Japanese manufacturers had improved for the first time in two-and-a-half years. But many investors were disappointed because they had hoped for a better reading, dealers said.
"The market had thought the confidence index would go up a bit higher," said Masaki Fukui, senior market economist at Mizuho Corporate Bank. "The survey showed the business sentiment still remained cautious." The sentiment index rose to minus 48 in June from a record low of minus 58 in March. Market forecasts had been for a figure of about minus 43.
The yen's decline was also due to firm buying-support for the "safe-haven" US dollar, dealers said. On Friday, investors bought the dollar after US job losses surged to 467,000 in June, lifting the unemployment rate to a 26-year high of 9.5 percent. The greenback is seen as a relatively safe bet in times of turmoil.
The disappointing data suggest "unemployment will continue to rise, creating a mood of distrust over the green shoots of recovery," said Daisuke Uno, a market strategist at Sumitomo Mitsui Banking Corp.
AUSTRALIAN DOLLAR: The Australian dollar ended the week slightly lower and may fall further in the short term on concerns its recent rally has gone too far, dealers said The Aussie closed Friday at 80.06 US cents, down from the previous week's close of 80.45 US cents.
The commodities-based currency has soared more then seven US cents in the past two months as hopes that a global recovery is imminent fuel expectations the world's appetite for Australian resources will bounce back strongly. However, AMP Capital Investors chief economist Shane Oliver said the rise in the Australian currency may have been slightly premature.
"The Australian dollar is vulnerable to a further period of correction or consolidation as investors wait for fundamentals to catch up to its recent rally," he said. ANZ economist Amber Rabinov expected the currency to trade between 77.90 US cents and 81.50 US cents in the short-term.
CHINESE YUAN: The yuan closed at 6.8323 to the dollar Friday, compared with Thursday's close of 6.8314 and a closing price of 6.8338 to the dollar the week before. The central bank had set the yuan central parity rate at 6.8333 to the dollar Friday, compared with 6.8309 Thursday.
The People's Bank of China allows a trading band of 0.5 percent on either side of the midpoint.
HONG KONG DOLLAR: The US-pegged Hong Kong unit ended the week unchanged at 7.751.
INDONESIAN RUPIAH: The rupiah ended at 10,210 to the dollar, up from 10,270 the week before.
NEW ZEALAND DOLLAR: The New Zealand dollar finished local trading Friday at 62.98 US cents, down from 64.50 the previous week The kiwi rose to the 65 US cents level early in the week but lost ground later as renewed fears about the health of the US economy saw a flight from higher yield currencies such as the New Zealand dollar.
Large New Zealand dollar denominated bond maturities this month were yet another negative factor weighing on the kiwi, dealers said.
PHILIPPINE PESO: The peso rose to 48.090 to the dollar on Friday afternoon from 48.305 on June 26.
SINGAPORE DOLLAR: The Singapore dollar rose to 1.4509 against the dollar Friday, up from 1.4548 the week before.
SOUTH KOREAN WON: The South Korean currency strengthened to 1,266.00 won per dollar from 1,284.30 won a week earlier, bolstered by the country's continuing current account surplus and higher domestic stocks. Dealers said the won was likely to trade in a narrow range in the coming week amid lack of any fresh momentum.
The won is tipped to move between 1,262 won per dollar and 1,270 won when the market reopens Monday, they said.
TAIWAN DOLLAR: The Tawian dollar rose 0.11 percent in the week to July 3 to close at 32.890 against the US dollar. The local currency closed at 32.925 a week earlier.
THAI BHAT: The baht was relatively stable against the dollar over the past week because there was no major factor to move the unit, a dealer said. The baht closed Friday at 34.08-10 baht to one dollar compared with last week's close of 34.05-07.
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