Asian forex: Rupiah near 17-year low

Indonesia's rupiah hit a near 17-year low on Friday as most emerging Asian currencies weakened down to show monthly losses due to a revival in expectations that the US Federal Reserve will increase interest rates. The rupiah fell as much as 0.8 percent to 12,940 per dollar, its weakest since August 1998, as investors saw more chances for further interest rate cuts by Bank Indonesia after a surprise reduction earlier this month.
Bank Indonesia Governor Agus Martowardojo said Indonesia's annual inflation rate is expected to ease to below 6.5 percent in February from 6.96 percent in January. A senior central bank deputy governor Mirza Adityaswara also told Reuters that a weaker rupiah helps export competitiveness improve. The rupiah has lost 4.1 percent against the dollar so far this year, becoming the worst performing emerging Asian currency so far this year.
The Indonesian currency led monthly losses among emerging Asian currency with 1.9 percent slide so far February, Thomson Reuters data showed. Most Asian currencies weakened on Friday as the dollar hovered near a one-month high against a basket of six major currencies. US durable goods orders rose more than expected in January, while core inflation was higher than expected.
In addition, San Francisco Fed President John Williams and St. Louis Fed chief James Bullard both suggested that the US central bank might end its near zero interest rate policy sooner than some traders expect. Singapore's dollar has eased 0.2 percent against the US dollar so far in February, Thomson Reuters data showed. That would make it eight consecutive months of depreciation. The data goes back as far as 1981, and it would be the longest losing streak since then.
South Korea's won fell 0.5 percent, while the Chinese yuan has eased 0.3 percent. The Philippine peso edged down. Some emerging Asian currencies bucked the depreciation trend in the region in February. Thailand's baht has risen 1.1 percent against the dollar, Thomson Reuters data showed, on bond inflows drawn by higher yields. The Malaysian ringgit has gained 0.4 percent as rebound in oil prices alleviated concerns that sliding crude may hurt the country's current account and widen the fiscal deficit. The Taiwan dollar rose 0.2 percent on stock inflows.