Asian Currencies Gain, led by ₱ Peso, on Speculation of More U.S. Stimulus

*(August 23, 2011)

Asian currencies advanced, led by the Philippine peso ₱, on speculation the Federal Reserve will unveil measures this week to revive growth in the world's biggest economy, improving the outlook for the region's exports.

The Fed will hold its annual symposium at Jackson Hole, Wyoming on Aug. 26. The Federal Open Market Committee is "prepared to employ" additional tools to bolster the economy, it said earlier this month, an indication that it may be considering another round of bond-buying that expands the supply of dollars, known as quantitative easing.

"The market is looking to the Fed for some kind of temporary fix and confidence booster," said Calbert Loh, head of treasury at Bangkok Bank Bhd. in Kuala Lumpur "The slowdown in developed markets is beginning to affect Asia."

The ₱ peso rose 0.4 percent to 42.485 per dollar as of 4:43 p.m. in Manila, according to data compiled by Bloomberg. South Korea's won gained 0.3 percent to 1083.88, Malaysia's ringgit climbed 0.3 percent to 2.9725 and the Singapore and Taiwan dollars strengthened 0.2 percent to S$1.2086 and NT$29.020, respectively.

The Taiwan dollar rebounded from a four-month low on speculation exporters are taking advantage of recent declines to repatriate earnings. Export orders increased 11.1 percent from a year earlier in July, after a 9.2 percent gain the previous month, government data showed on Aug. 19.

Taiwan Weathers Slowdown

"The NT$29 level is very attractive for exporters, we see many of them selling the greenback," said Tarsicio Tong, a Taipei-based foreign-exchange trader at the Union Bank of Taiwan. "The export orders figures show Taiwan hasn't been affected much by the global slowdown."

Indonesia's rupiah snapped a two-day decline on optimism global investors will boost holdings of local assets to benefit from growth in Southeast Asia's largest economy. The currency strengthened 0.2 percent to 8,546 per dollar.

Gross domestic product will rise 6.5 percent this year, the most since 1998, President Susilo Bambang Yudhoyono said last week. The currency has advanced 5 percent in 2011 as offshore funds bought $1.9 billion more Indonesian stocks than they sold through Aug. 19, exchange data show.

"Positive sentiment toward the Indonesian economy is supporting the currency," said Lindawati Susanto, head of treasury at PT Bank Resona Perdania in Jakarta.

Thailand's GDP Weakened

Thailand's baht weakened 0.1 percent to 29.84 per dollar after a government report showed gross domestic product rose 2.6 percent in the three months through June from a year earlier, following a 3 percent gain in the first quarter. The median estimate of economists surveyed by Bloomberg News was for a 3.6 percent advance.

"It's understandable to see a slower growth in the second quarter for countries relying on exports like Thailand," said Tohru Nishihama, an economist at Dai-ichi Life Research Institute Inc. in Tokyo. "Investors remain risk averse and that's supporting bonds."

Elsewhere, China's yuan declined 0.13 percent to 6.4013 per dollar and India's rupee dropped 0.2 percent to 45.8575.