* Yuan edges up on firmer midpoint for 2nd day
* Won falls on offshore funds; intervention limits losses
* Ringgit nears 3-month low on weak oil, output data
(Adds text, updates prices)
By Jongwoo Cheon
SINGAPORE, Jan 11 (Reuters) – Most emerging Asian currencies
extended losses on Monday despite China’s stronger guidance on
the yuan as the outlook for the renminbi remained weak amid
uncertainties over Beijing’s exchange rate policy on a slowing
economy.
The yuan rose after the People’s Bank of
China set its daily midpoint rate higher for a second
session. That helped the Singapore dollar turn
firmer and other emerging Asian currencies recover earlier
losses.
Still, regional units failed to fully benefit from the
renminbi’s rebound as doubts lingered over whether and how long
China will continue efforts to support the currency.
China’s consumer inflation barely edged up in December,
while companies’ factory-gate prices kept falling, adding to
concerns over growing deflation risks in the world’s
second-largest economy.
“Chinese authorities showed stabilisation efforts for a few
days. But that won’t last long and the yuan may fall sharply
again,” said Yuna Park, a currency and bond analyst at Dongbu
Securities in Seoul.
“Emerging market currencies will stay weaker in the first
quarter at least on more volatility in Chinese markets. In
addition, talks over timing on more U.S. interest rate hikes
will emerge,” Park added.
U.S. payrolls surged in December and the jobs count for the
prior two months was revised sharply higher, showing the world’s
top economy on solid ground despite recent global financial
market turbulence, led by Chinese markets.
South Korea’s won hit a 5-1/2-year low as the
country was seen more sensitive to a slowing Chinese economy.
The Malaysian ringgit hovered near a three-month
low as slumping crude prices added to concerns over the
country’s falling oil and gas revenues. November industrial
production slowed to its weakest pace in 16 months.
South Africa’s rand hit a record low as traders
said Japanese investors seemed to be bailing out of long
positions in the currency.
WON
The won lost as much as 1.1 percent to 1,211.5 per dollar,
its weakest since July 2010, as offshore funds continued to sell
the South Korean currency.
Goldman Sachs revised its three- and six-month forecasts for
the won to 1,250 and 1,280, respectively, from the previous
1,200 and 1,230, on the yuan’s weakness and a slowdown in Asia’s
fourth-largest economy.
“We believe that the recent depreciation is not just a bout
of volatility but a reflection of a trend towards 1,300,”
Goldman Sachs said in a research note.
“We continue to expect sustained trade stagnation in Korea
as the stagnation in our view largely reflects global structural
factors, including China rebalancing and global technological
progress.”
Still, the won pared some of earlier losses as South Korea’s
foreign exchange authorities were spotted intervening to stem
the won’s weakness, traders said. The renminbi’s rebound also
helped the won recover some of slides.
RINGGIT
The ringgit fell as much as 0.7 percent to 4.4160 per dollar
from Friday’s close. That compares with Thursday’s low of
4.4250, its weakest since Oct. 2.
The Malaysian currency pared some of the losses on the
yuan’s rebound, but stayed under pressure on weaker industrial
production data.
Factory output in November grew 1.8 percent from a year
earlier, its slowest since July 2014 and well below the median
forecast of 4.0 percent from a Reuters poll of economists.
CURRENCIES VS U.S. DOLLAR
Change on the day at 0530 GMT
Currency Latest bid Previous day Pct Move
Japan yen 117.29 117.27 -0.02
Sing dlr 1.4389 1.4430 +0.28
Taiwan dlr 33.399 33.501 +0.31
Korean won 1208.30 1198.10 -0.84
Baht 36.29 36.30 +0.03
Peso 47.26 47.17 -0.19
Rupiah 13925.00 13920.00 -0.04
Rupee 66.81 66.63 -0.26
Ringgit 4.4000 4.3850 -0.34
Yuan 6.5820 6.5938 +0.18
Change so far in 2016
Currency Latest bid End prev year Pct Move
Japan yen 117.29 120.30 +2.57
Sing dlr 1.4389 1.4177 -1.47
Taiwan dlr 33.399 33.066 -1.00
Korean won 1208.30 1172.50 -2.96
Baht 36.29 36.00 -0.80
Peso 47.26 47.06 -0.41
Rupiah 13925.00 13785.00 -1.01
Rupee 66.81 66.15 -0.98
Ringgit 4.4000 4.2935 -2.42
Yuan 6.5820 6.4936 -1.34
(Editing by Sam Holmes)
