Rupiah at four-year high

The rupiah hit a near four-year high against the dollar after the central bank signalled on Friday it was willing to use the currency's gains in its battle with inflation even though it was seen buying dollars in an effort to control the rupiah's rise.
The central bank kept its benchmark rate on hold at its policy meeting, but said that it would gradually lift borrowing costs in the future and that it saw room for the rupiah to strengthen further without hurting export competitiveness. The dollar slid by up to 0.3 percent against the rupiah to 8,780, the rupiah's strongest level since June 2007, from Thursday's close of 8,803.
Foreign investors continued to sell the pair, which has room to fall to 8,755, the low in June, but the central bank was on guard, dealers said. Dollar/Taiwan dollar touched 29.310, the lowest since February 18. Dollar/won hit a near two-week low as continuous foreign purchases of Seoul stocks prompted stop-loss dollar sales. The pair fell to as low as 1,114.1, the lowest since February 21.
Dollar/peso may break through its support at 43.25, the low of on February 21 and the 61.8 percent of the November-January rise, if the central bank take actions to curb inflation. A break of this support will see a decline to 42.90, the 76.4 percent of the rise.