Philippine peso retreats, month-end dollar demand hurts Asia FX

Posted at 08/28/2014 6:30 PM

SINGAPORE - The Philippine peso turned down after hitting its strongest in more than three weeks on Thursday as most emerging Asian currencies eased on month-end corporate dollar demand.

The peso closed at P43.71 against the US dollar.

Earlier, the peso rose as much as 0.3 percent to P43.55 per dollar, its strongest since Aug. 5, as better-than-expected economic growth in the second quarter boosted prospects for a further rate hike.

The peso reversed direction on month-end dollar demand from local companies while broad weakness in regional peers prompted investors to cover short positions. Manila shares also lost 0.8 percent, underperforming other Asian equity markets.

Indonesia's rupiah eased 0.2 percent as importers bought dollar for month-end payments.

Investors grew more concerned over how exports will be affected if coal mining contracts are revoked due to unpaid royalties.
The Malaysian ringgit dipped as investors trimmed their exposure to both the U.S. dollar and the Singapore dollar. Malaysian corporate demand for the greenback also weighed on the ringgit.

Sentiment on the Malaysian currency and most other emerging Asian currencies had improved in the last two weeks, a Reuters poll showed earlier, boosted by optimism that any European stimulus will draw more capital inflows.