The Indonesian rupiah and the Philippine peso fell against the dollar on Monday, leading a broad decline in Asian currencies on worries that mounting inflation may prompt more aggressive policy tightening and spark major outflows of foreign funds.
The rupiah was little fazed by Moody's upgrade of the country's foreign and local-currency bond ratings to one notch below investment grade as the moved already had been largely factored into the currency market, dealers said.
Foreign investors withdrew a combined net total of $978 million from the Indonesian, Thai and Philippine stock markets last week - the highest in the last five years and the third largest in the last 10 years, according to data from Bloomberg, FactSet and Morgan Stanley Research, the Business Times reported. Indonesia and Thailand led the fund outflows at $535 million and $389 million, respectively, the report added. The peso lost 0.4 percent against the dollar amid growing worries that any rate rises by the central bank to quell inflation could spark capital outflows. The baht fell as interbank and importers offers forced it to slide to as soft as 30.670.
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