East meets west when Asian currencies glided down against the US dollar yesterday; the demand for emerging-market assets in Asian stocks were reduced. Russia and the International Monetary Fund’s confidence in the US Dollar were partly to blame.
The Singapore dollar could have dropped as low as 1.4583 against the dollar, but it regained its glory at 1.457 at the end of the day. However, Thai baht went down and closed at 34.225. In addition, the Philippine Peso also dropped to its lowest level in six weeks.
This event caused Asian stock markets to be alerted and be on guard in picking their targets, subsequent to a decrease in commodity prices. To name a few, Korea’s Kospi Composite went down 1.13 percent, Hong Kong’s Hang Seng Index crashed to 2.07 percent and Taiwan Weighted slumped to 3.45 percent.
Russian finance ministers stated they are confident that the economies are stabilising, but not yet hundred percent cured from the recent global crisis.
“The G-8 is clearly switching its focus towards exit strategies from the extraordinary stimulus measures, though they stressed there would be no immediate end to stimulus. The brightened outlook for the global economy expressed by the G-8 is likely to add to growing confidence already shown by investors,” supposed by David Watt, RBC Capital Markets’ senior currency strategist.
The global crisis had left Singapore in a rising unemployment rate and leaving consumers buying fewer cars and less household equipments.
Markets are on the watch on important proceedings or remarks on US-dollar reserve holdings at the first BRIC summit in Yekaterinburg, Russia.