The South Korean won hit an over four-month high against the dollar on Monday, leading overall gains in Asian currencies, as optimism on the US economy pushed up regional stocks to their highest in more than two years. The dollar also fell on suggestions that the Federal Reserve might further resort to quantitative easing to boost the world's biggest economy, which would boost currencies in Asia.
But the foreign exchange authorities in the region were spotted or suspected buying dollars to check strength in their currencies, dealers said. Still, Asian currencies are expected to stay firm as investors keep looking for assets in the region with eased worries about the US economy seen brightening further the region's economic outlook, dealers and analysts said.
The local currency pared some of its earlier gains as the foreign exchange authorities were spotted buying dollars to check its gains, dealers said. The local currency closed up 0.6 percent at 1,148.2 a dollar from Friday's domestic finish of 1,155.2. Earlier, it strengthened to as firm as 1,146.0, the strongest since May 18.
Thai baht rose 0.4 percent in line with a broad Asian rally against the dollar. Philippine peso rises 0.4 percent to 43.94 per dollar, buoyed by regional stock market gains and a weaker dollar. Still, investors remain wary of possible intervention by the central bank to curb the peso's strength.