SINGAPORE: Most emerging Asian currencies slumped on Monday as risk sentiment soured with a market focus shifting to Washington politics ahead of the first debate between Democrat candidate Hillary Clinton and Republican Donald Trump.
The Philippine peso hit a seven-year low in heavy trading as importers' dollar demand added to downward pressure stemming from stock outflows.
Malaysia's ringgit fell as doubts that there will be an oil production deal among OPEC producers underscored concerns over the country's oil and gas revenue.
The South Korean won slid amid caution over possible intervention by the foreign exchange authorities to stem further appreciation in the best-performing emerging Asian currency so far this year.
Asian stocks fell as investors were awaiting the debate between Clinton and Trump, the first of three face-to-face contests with polls showing a tightening race. Trump is seen as a more protectionist on international trade than Clinton as he has vowed to renegotiate some trade agreements.
"Trump's trade policy doesn't bode well definitely for Asia," said Andy Ji, Asian currency strategist for Commonwealth Bank of Australia in Singapore.
Ji said commodity-linked currencies such as the ringgit and the Indonesian rupiah could be more affected.
PHILIPPINE PESO
The peso lost 0.6 percent to 48.26 per dollar, its weakest since September 2009.
Local importers scrambled for the greenback for payments, which further weakened a currency already impacted by sustained equity outflows.
Foreign investors were net sellers in Manila stocks over the past six weeks. Analysts say President Rodrigo Duterte has been seen as alienating allies of the Philippines such as the United States with his crackdown on drugs.
The peso's slide "picked up momentum after the break of 48," said a senior Philippine bank currency trader in Manila who expects the currency to weaken to 48.50.
The Philippine unit may see a minor chart support at 48.35, but it is likely to seen heading to around 49.00, analysts said.
RINGGIT
The ringgit slid as oil prices tumbled 4 percent on Friday with Saudi Arabia and Iran making little progress in achieving preliminary agreement to freeze production.
Most Malaysian government bond prices eased, putting further pressure on the ringgit.
The Malaysian currency pared some of its earlier losses with a chart support seen at the session low of 4.1350 per dollar, analysts said.
Crude prices also rebounded on Monday in Asia after the Algerian energy minister said all options were possible for an oil output cut or freeze at this week's informal OPEC meeting.
WON
The won slid as South Korea's authorities are unlikely to allow it to break 1,100 per dollar level, traders said.
Last week, the authorities were suspected of intervening with a warning against further appreciation when the won tried to strengthen past the line, according to traders in Seoul.
Importers on Monday bought dollars for payments, while exporters were on the sidelines although the month-end is approaching, traders said.
Comments
Comments are closed.