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09:34 2006/09/24
Currencies dip in Asia on export fall worries
SINGAPORE: Asian currencies weakened, paced by Indonesia??™s rupiah and the Philippine peso, on speculation investors will sell emerging-market assets as US growth slows. A report on Thursday on Philadelphia manufacturing provided further evidence a two-year cycle of interest-rate increases is cooling the US economy.
Asian exports may suffer on a decline in consumer demand in the US, one of the region??™s biggest overseas markets.
The rupiah posted the worst week in a month, while the peso snapped a three-week rally.
???A lot of money has gone into Asian and Latin American markets and now people may be unwinding their holdings, pushing down the currencies,??™??™ said Nizam Idris, a currency strategist at UBS AG in Singapore. ???Investors are more averse to risk following yesterday??™s poor US numbers.??™??™
The rupiah lost 0.7% this week to 9,188, the worst-performing of 15 Asia-Pacific currencies tracked by Bloomberg. The peso, the poorest performer on Friday, declined 0.2% to 50.35 for the week, according to the Bankers Association of the Philippines.
The Federal Reserve Bank of Philadelphia??™s general economic index declined to minus 0.4 from 18.5 in August, the biggest monthly drop since January 2001, it said on Friday.
The New York-based Conference Board said in a separate report on the same day its index of leading economic indicators fell 0.2% for a second month in August.
Brazil??™s real and Mexico??™s peso declined on Thursday, falling as much as 1.9% and 1.1%, respectively.
???The fear is that exports will be hammered as the US economy slows and demand for Asian goods falls,??™??™ said Steve Rowles, currency strategist at CFC Seymour Ltd in Hong Kong. ???Countries like the Philippines, Thailand and Indonesia are the most vulnerable, since they depend on exports.??™??™ ??“ Bloomberg
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