0904678800

Ngọc 0904678800 Q1,TPHCM

Asian Currencies: Won Declines on Growth Concern, Baht Falls
By Yumi Kuramitsu and Jake Lee
Nov. 18 (Bloomberg) -- South Korea's won posted a weekly loss, snapping three weeks of gains, on concern investors will take funds out of the country as economic growth slows.
The government may lower its growth forecast for 2007 to the low end of 4 percent from a previous target of 4.6 percent, Chosun Ilbo reported yesterday, citing an unidentified finance ministry official. Investors overseas have this year sold a net $11.68 billion in Korean shares, according to stock exchange data.
``There are certainly some fundamental reasons undermining the won,'' said Sean Callow, senior foreign-exchange strategist at Westpac Banking Corp. in Singapore. ``Korea's economy is going to slow next year.''
The won weakened 0.5 percent this week to 938.90, according to Seoul Money Brokerage Services Ltd. The currency will trade at 938 at the end of this year, said Callow.
The likelihood of lowering the forecast is increasing because private consumption is declining and exports may drop to single-digit growth next year, Chosun Ilbo quoted the finance ministry official as saying. A Commerce Ministry report on Nov. 16 showed department store sales growth almost stalled in October.
Asia's third-largest economy faces risks including the possibility of weaker-than-expected U.S. growth that may damp demand for exports, the International Monetary Fund said Nov. 10.
Weekly Losses
The Singapore dollar weakened 0.2 percent this week to S$1.5596. The city-state's exports rose less than expected in October, a report from the government's trade promotion body showed yesterday.
Non-oil domestic exports increased a seasonally adjusted 2.1 percent from September, when they gained a revised 4.5 percent. The number compared with the median forecast of 2.7 percent growth in a Bloomberg News survey of eight economists.
Elsewhere in Asia, the Taiwan dollar dropped 0.4 percent in the five-day period to NT$32,934, ending two weeks of gains, according to Taipei Forex Inc. The Malaysian ringgit weakened 0.4 percent on week to 3.6525. The Philippine peso fell 0.2 percent to 49.99, according to data compiled by Bloomberg.
Indonesia's rupiah slumped 0.6 percent to 9,167, posting the third weekly loss, on speculation lower interest rates will prompt overseas investors to sell the currency. Bank Indonesia, the central bank, said yesterday the rupiah exchange rate against the U.S. dollar may be stable until the end of the year.
``The rupiah is at a good level now and is conducive for export and import activities,'' Deputy Governor Aslim Tadjuddin told reporters at the central bank's compound in Jakarta yesterday.
Thailand's baht, Asia's best performer this year, weakened on concern the central bank will sell the currency to prevent gains from hurting exports.
Raising Their Voice
Exporters such as Thai Union Frozen Products Pcl, the world's second-biggest tuna canner, this week asked the central bank to curb the appreciation, saying it has undermined their competitiveness. Bank of Thailand Governor Tarisa Watanagase on Nov. 15 said the central bank is ready to buy or sell the currency, which this week touched a seven-year high.
``Exporters raising their voices led to speculation the central bank will come in,'' said Koji Fukaya, chief economist and currency analyst in Tokyo at Bank of Tokyo-Mitsubishi UFJ Ltd. The central bank ``will probably be successful in putting a break on the currency's gain.''
Thai Exporters
The baht dropped 0.3 percent yesterday to 36.61, almost erasing its weekly gain. It may trade between 36.50 and 37 in a week, Fukaya said.
The baht on Nov. 14 reached the highest since February 1999 as overseas investors bet the economy will pick up after armed forces ousted Thaksin Shinawatra as prime minister in a Sept. 19 coup. Consumer confidence rose for a second month in October to a seven-month high, according to the University of the Thai Chamber of Commerce.
Thai exporters of chicken meat, shrimps and soybean are losing orders to competitors in China, Indonesia and Vietnam, whose currencies are strengthening at a slower pace than the baht, Poj Aramwattananont, president of Thai Frozen Foods Association, said on Nov. 16 at a press conference held by 10 industry groups.
A stronger currency increases the costs of Thai products overseas and reduces baht-denominated profits of exporters. The baht climbed 12 percent this year against the dollar. China's yuan rose 2.5 percent, Indonesia's rupiah climbed 7.3 percent and Vietnam's dong fell 1.1 percent