Asian currencies climb to 14-year high

Asian currencies advanced to a 14-year high after European leaders pledged more aid for Greece, easing concern the debt crisis will worsen and bolstering demand for emerging-market assets. The Bloomberg-JP Morgan Asia Dollar Index, which tracks the region\'s ten most-traded currencies excluding the yen, reached the highest level since August 1997 and completed a weekly gain after the €159 billion (Dh838.5 billion) package was announced. China\'s yuan rose to a 17-year high on Friday, the Philippine peso reached a three-year peak and South Korea\'s won touched the strongest level since August 2008. \"It\'s quite clear that the risk environment has improved significantly as the European summit agreement has helped to calm fears over the debt problems in Europe,\" said Moh Siong Sim, a currency strategist at Bank of Singapore. The peso strengthened 1.3 per cent this week to 42.403 versus the dollar in Manila, according to data compiled by Bloomberg. Malaysia\'s ringgit appreciated 1 per cent to 2.9755, Thailand\'s baht climbed 0.8 per cent to 29.83, Singapore\'s dollar added 0.8 per cent to 1.2091 and the won rose 0.6 per cent to 1,051.98. The ringgit reached a two-month high on speculation the central bank will raise borrowing costs after Governor Zeti Akhtar Aziz said curbing inflation is a priority. Consumer prices in Malaysia rose to a two-year high of 3.5 per cent in June, according to official data released July 20. \"The ringgit could hold on to its strength as there are growing expectations that the Malaysian central bank will raise its policy rate,\" said Calbert Loh, head of treasury at Bangkok Bank in Kuala Lumpur. The peso gained the most this week since September 2010 after the International Monetary Fund said on July 20 that the near-term outlook for the Philippines was favourable. \"The fundamentals, growth prospects and the fiscal side remain positive in the Philippines,\" said Lito Biacora, vice president for treasury at Bank of the Philippine Islands in Manila. The baht had a third weekly advance as overseas investors added to their holdings of the nation\'s stocks. Global funds bought $370 million more Thai equities than they sold this week through July 21, taking this month\'s net purchases to $762 million. Indonesia\'s rupiah appreciated 0.3 per cent this week to 8,523 per dollar after Fitch Ratings said on July 19 that the country may achieve an investment-grade credit rating before the end of next year. From / Gulf News