The Indonesian rupiah rose on Friday but later pared its gains in line with local stocks, while the Singapore dollar eased on talk of official intervention. The Japanese yen surged to a one-month high against the dollar as traders remained worried about the potential for further weakness in Chinese shares and shied away from risky investments. The Philippine markets were closed for holiday.
RUPIAH The rupiah gains 0.3 percent to 10,030 per dollar as the US currency stayed broadly weaker while local stocks rose. It later pulled back to 10,040 as local stocks gave up earlier gains. "It's also because of a lot of short dollar covering ahead of the weekend," said a trader in Jakarta.
The rupiah, the best performing currency in Asia, is still up nearly 10 percent against the dollar so far this year. Indonesian shares edged up in early trade, but later pulled back in tandem with Chinese stocks. Meanwhile, three-month dollar/rupiah NDFs fall to 10,190, implying a 1.7 percent rupiah fall from the spot compared to 2 percent on Thursday.
SINGAPORE DOLLAR The Singapore dollar fell almost 0.3 percent to 1.4451 per US dollar amid talk of possible official intervention to curb the currency strength. One trader cited suspected US dollar-buying at 1.4365-70 via an agent bank.
The Singapore dollar has gained nearly 8 percent since early March and most analysts believe the currency is close to the upper end of the central bank's secret trade-weighted band, fanning speculation that it may intervene to curb its strength. Singapore's central bank, which lowered the mid-point of the currency band in April in an effort to support the economy, is widely expected to keep its zero appreciation stance in October.