KUALA LUMPUR: Asian currencies weakened after a central bank adviser forecast China’s economy will slow further and concern mounted that Greece won’t meet bailout targets, sapping demand for emerging-market assets.
The Bloomberg-JPMorgan Asia Dollar Index fell by the most in more than a week after Song Guoqing, an academic member of the People’s Bank of China monetary policy committee, said on July 21 that economic expansion may cool for a seventh quarter to 7.4% in the three months through September. German Vice Chancellor Philipp Roesler said yesterday he’s “very skeptical” that European leaders will be able to rescue Greece.
South Korea’s won slumped 0.5% to 1,147.20 per dollar as of 11:44 a.m. in Seoul, according to data compiled by Bloomberg. Malaysia’s ringgit dropped 0.6% to 3.1714, Thailand’s baht fell 0.4% to 31.77 and Indonesia’s rupiah slid 0.5% to 9,494.
The Asia Dollar Index declined 0.3% to 114.69, with its 60-day historical volatility at 3.70% from 3.66% on July 20. China’s yuan declined to the lowest level since October as the central bank weakened the daily reference rate by 0.25%, the most since June 25.
China is the biggest export market for South Korea, Taiwan and Thailand and the second-largest for Malaysia. Overseas sales account for about two-thirds of Taiwan and Thailand’s economies and about half of Korea’s. (Bloomberg/T05/TW)