Asian Central Banks Keep Up Intervention as Dollar Weakens
Author: David Roman</br></br>SINGAPORE--The central banks of South Korea, Singapore, Thailand and Indonesia were suspected of intervening in foreign exchange markets Wednesday to contain gains in their currencies, but analysts say the continued weakness of the U.S. dollar means Asian units should extend their rallies.</br></br>The wave of intervention, which has continued across the region for most of this year, hasn't been strong enough to reverse the strengthening trend in Asian currencies, as many policymakers are allowing their currencies to rise slowly to limit imported inflation.</br></br>That stance was reinforced after China, the top trading partner for key Asian countries, said in June it would let the yuan strengthen against the dollar--meaning that other Asian countries can maintain their export competitiveness against China even if their currencies rise a bit.</br></br>On Wednesday the Thai baht and the Malaysian ringgit hit their highest levels since the 1997 Asian currency crisis, while the Singapore dollar rose to an all-time high.