Most Asian currencies were knocked to multi-month lows against a robust dollar on Tuesday, while the Indonesian rupiah extended a slide to hit its lowest level in more than three years. The South Korean won shed about one percent, reversing early gains, to hit a six-month low around 1,054.5 per dollar.
The Taiwan dollar eased almost three-quarters of a percent to about 32.04 per dollar - its weakest level since January. The Philippine peso dropped to a six-month low around 56.27 per dollar.
Southeast Asian currencies did not fare much better against a broadly firm dollar, with the Thai baht falling to an 8-1/2 month low around 41.55 and the Singapore dollar weakening to its lowest level in more than nine months around 1.7005 per dollar.
Analysts said the losses in the South Korean won and Taiwan dollar reflected a delayed reaction to a resurgent dollar.
They said the north-east Asian currencies have outperformed regional units thanks to healthy current account surpluses but were unable to escape the impact of broad-based dollar strength built on rising US interest rates.
"There is a combination of factors behind Asian currency weakness," said Callum Henderson, head of currency strategy at Standard Chartered.
"You saw the first reaction to dollar strength in currencies like the Sing dollar and Thai baht. Only over the past week have you seen any reaction in north Asia, so dollar/Korean won and dollar/Taiwan dollar are very well bid at the moment."
The rupiah shed about three quarters of a percent to 9,900 per dollar, its lowest level since March 2002.
Analysts said sentiment remained bearish towards the currency amid worries that high oil prices will force state-oil firm Pertamina to buy millions of dollars to finance oil imports.
Indonesia's chief economic minister, Aburizal Bakrie, said on Tuesday the rupiah was undervalued and its weakness was caused by strong dollar demand to finance oil imports.
Position adjusting ahead of the implementation of tighter currency regulations later this month have also undermined the rupiah, which has lost almost six percent against the dollar this year, dealers said.
The dollar rose to a 14-month high against the euro and a 11-month peak against the yen, supported by the prospect of rising US interest rates.
Dealers said regional Asian currencies would be capped while the dollar was heading up against major currencies.
"The dollar looks quite strong at the moment so if dollar/majors continues its uptrend then dollar/regionals will follow suit as well," a trader in Singapore said.
Simon Flint, head of emerging Asian currency strategy at Merrill Lynch, said weak data was also undermining regional currencies. "Data generally from Asia has been disappointing. Overnight we had the PMI from Singapore, which was weaker than consensus," he said.
Singapore's manufacturing sector rose in June for the second month but its output of electronics shrank sharply, a purchasing managers' index (PMI) showed on Monday.
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