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EM ASIA FX-Rupiah weakens on fear of outflows, peers buoyed by China trade data
January 10, 2013 / 7:03 AM / 5 years ago

EM ASIA FX-Rupiah weakens on fear of outflows, peers buoyed by China trade data

* One-mth dlr/rupiah NDFs at highest since Sept 2009
    * Philippine peso at near 5-yr high; won hits 17-mth peak
    * S.Korea, Philippine intervention spotted - dealers
    * Ringgit up after stronger industrial output data

 (Adds text, updates prices)
    By Jongwoo Cheon
    SINGAPORE, Jan 10 (Reuters) - Fears of capital outflows hit
the Indonesian rupiah on Thursday with one-month forwards at
weakest in more than three years, while its Asian peers gained
after stronger-than-expected China's trade data.
    The rupiah spot's indicative prices slid 0.5
percent to 9,700 per dollar on exchange pages, but its real
prices were softer with 9,850-9,870 traded, dealers said.
    One-month dollar/rupiah rose 0.6 percent to
9,930, its highest since September 2009.
    That came before the central bank is expected to keep its
benchmark rate unchanged at a record low of 5.75 percent later
in the day, a Reuters poll showed. 
    Most economists in the survey also saw Bank Indonesia
holding the deposit facility rate, or FASBI, at its current
level of 4 percent this time, although they expect gradual
    "Should it fail to hike the FASBI rate again, as it did in
August by 25 bps to 4.25 percent, it will send a negative signal
to the currency market and add to negative downside volatility,"
said Sacha Tihanyi, senior currency strategist for Scotiabank,
in a research note.
    Five-year bond yields rose to 4.713 percent and three-year
yields rose  to 4.756 percent, as foreign investors sold
government debt.
    A government bond sale on Jan. 15 is unlikely to attract
huge inflows, unless Indonesia act to reduce concerns over
inflation and its current account deficit, dealers and analysts
    "On valuation, the rupiah looks very cheap, but I don't
expect a near term recovery," said Yuna Park, a currency and
bond analyst at Dongbu Securities in Seoul.
    "It is possible for foreigners to sell Indonesian bonds
further, given worries about inflation, especially due to the
government's plan to cut power subsidies. Its current account is
unlikely to improve significantly," Park added.
    Persistent dollar demand from importers has also helped
render the rupiah the worst performing emerging Asian currency
since the new year began.
    Other emerging Asian currencies gained with the Philippine
peso hitting a near five-year high and the South
Korean won at 17-month peak.
    Chain's exports grew 14.1 percent in December from a year
earlier to hit a seven-month peak, easily beating market
expectations of a 4 percent increase. 
    The won firmed as far as 1,060.3 per dollar, its strongest
since August 2011.
    Offshore funds and domestic exporters bought the South
Korean currency, while the foreign exchange authorities were
spotted slowing down its appreciation, dealers said.
    "I do not expect the won to strengthen past 1,060 as the
authorities will keep intervening," said a foreign bank dealer
in Seoul.
    Investors are keeping an eye on the central bank's monetary
policy meeting on Friday when the Bank of Korea is expected to
hold interest rates steady. 
    The Philippine peso hit 40.730 per dollar, its strongest
since March 2008, according to Thomson Reuters data.
    Philippine's export growth in November touched a 5.5
percent, its slowest in three months, but investors focused more
on China's stronger-than-expected trade data. 
    "It is more on improving global risk sentiment as China came
out with great trade data, which goes to show that China is
definitely rebounding," said a foreign bank dealer in Manila.
    The dealer revised his forecast for the peso's January peak
to 40.60 from 40.70 with the China's data.
    But the Philippine currency failed to strengthen furhter 
now as the central bank was spotted intervening, dealers said.
    Fixing-linked dollar demand also limited the peso's gains,
they added.
    The ringgit gained as investors cleared long
positions in the greenback.
    The Malaysian currency found more support from data showing
the country's industrial production growth in November exceeded
market forecasts. 
    The Singapore dollar barely changed against the
dollar as it faced a chart resistance around 1.2260 to the
    But investors chased the city-state's currency to
the euro. The Singapore dollar firmedd 0.2 percent to 1.6000
against the euro.
  Change on the day at 0625 GMT
  Currency    Latest bid   Previous day    Pct Move
  Japan yen        88.12          87.89       -0.26
  Sing dlr        1.2266         1.2270       +0.03
  Taiwan dlr      28.985         29.110       +0.43
  Korean won     1060.10        1061.70       +0.15
  Baht             30.37          30.38       +0.03
  Peso             40.74          40.79       +0.11
  Rupiah         9700.00        9650.00       -0.52
  Rupee            54.65          54.75       +0.18
  Ringgit         3.0340         3.0388       +0.16
  Yuan            6.2235         6.2262       +0.04
  Change so far in 2013
  Currency    Latest bid  End prev year    Pct Move
  Japan yen        88.12          86.79       -1.51
  Sing dlr        1.2266         1.2219       -0.38
  Taiwan dlr      28.985         29.136       +0.52
  Korean won     1060.10        1070.60       +0.99
  Baht             30.37          30.61       +0.79
  Peso             40.74          41.05       +0.76
  Rupiah         9700.00        9630.00       -0.72
  Rupee            54.65          54.99       +0.62
  Ringgit         3.0340         3.0580       +0.79
  Yuan            6.2235         6.2303       +0.11
 (Additional reporting by Rieka Rahadiana in JAKARTA and IFR
Markets' Catherine Tan; Editing  by Simon Cameron-Moore)

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