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Indian rupee

BOMBAY: The Indian rupee ended firmer on Wednesday as banks liquidated long dollar positions initiated earlier in the day, dealers said.

They said banks had bought dollars on reports the finance ministry had factored a three percent depreciation in the rupee into the budgetary estimates.

The rupee ended at 43.575/58 per dollar off the earlier low of 43.62 compared with the open of 43.6075/6125.

It had ended at 43.61/6125 on Tuesday.

"Traders soon realised it was merely a benchmark and not a forecast. hence the selling," a dealer at state-run bank said.

"Besides there was also some customary swap differential dollar sales," he said.

Earlier in the day the chief economic advisor to the Finance Ministry, Shankar Acharya told a news conference that the 2000/2001 budget had assumed an exchange rate of 45 rupees to a dollar.

Finance Minister Yashwant Sinha presented his budget for 2000/2001 (April-March) to parliament on Tuesday. -Reuters

Indonesian rupiah

JAKARTA: Indonesia's rupiah was stagnant in lacklustre late trading on Wednesday with an expected hike in US interest rates, prompting players to retreat from the market, traders said.

The rupiah was trading at 7,400/7,420 against the dollar compared with 7,411/7,431 when the market opened in the morning.

"I think US interest rates remain a dominant factor in the market. The political front is quiet and is barely noticed by players these days," said one dealer.

Dealers said the rupiah could weaken if US rates increased as expected, adding that lower one-month SBI certificates also discouraged players to hold onto the Indonesian currency.

"The weighted average interest rate fell to 11.01 percent today compared with 11.02 percent last week. This makes rupiah become more unattractive to keep," said another dealer.-Reuters

Chinese yuan

SHANGHAI: China's yuan closed higher against the dollar on Wednesday, buoyed by technical buying from domestic banks after a solid fall in the previous session.

The yuan ended at 8.2786 to one US dollar from 8.2793 on Tuesday after moving in a range of 8.2768 and 8.2788.

"Domestic banks conducted some technical buying after on Tuesday's fall, pushing up the yuan," said a local bank dealer. "But the rise did not represent a trend."

Dealers said the yuan was under pressure from increased dollar demand from importers as China's imports were picking up after a lull in early February because of the Chinese Lunar New Year holiday.

But it was supported by China's healthy foreign trade surplus in the past few months, which ensured a steady inflow of foreign exchange onto the market, they said. It was likely to move between 8.2780 and 8.2800 in the near term, they said.

There was no evidence of intervention by the People's Bank of China in the tightly-controlled market although the central bank has said it plans to widen the yuan's movement range, dealers said.

An official at the bank said on Friday the government was considering widening the band, but had no timetable.

The yuan closed lower against the Japanese yen at 7.6675 to 100 yen compared with 7.4953 on Tuesday. It ended unchanged against the Hong Kong dollar at 1.0632 to HK$1.0. -Reuters

Philippine peso

MANILA: The Philippine peso closed weaker against the dollar on Wednesday, tracking other regional currencies, dealers said.

Dealers said banks bought dollars late in the session as the Thai baht weakened to below 38 per dollar and the Singapore dollar fell to 1.72 to the US unit.

The peso ended at 40.985 from the close of 40.935 on Tuesday. It reached a high of 40.88 early in the session on a lack of corporate demand.

Turnover rose to $211.5 million from the previous $209.9 million.Dealers said the peso's downside was however limited due to expectations that the central bank would sell dollars when the peso reached 41 to the dollar.

The peso reached a low of 41.02 on Tuesday and dealers said its rebound at the close was due to the central bank's intervention.

The central bank has denied the talk, saying it would only enter the spot market if dollar purchases were speculative.

"We expected the central bank to intervene at the 41 level again so most banks were very cautious of their position," a dealer with another local bank said.

But dealers said the bias was for banks to keep long dollar positions due to poor sentiment on local markets.

The stock market has fallen more than 20 percent since the start of the year, hounded by political and price manipulation concerns, while interest rates remain low despite a likely rate hike in the United States.

"There has been no pronouncement of whether or not the central bank would adjust interest rates as we expect another Fed hike in the next two weeks, so for you to be on the safe side, you just stay long on dollars," the dealer said.

Dealers placed the peso's immediate trading range at 40.85 to 41.10 on Thursday.-Reuters