June 9 (Bloomberg) -- Asian currencies rose, led by Malaysia’s ringgit and Indonesia’s rupiah, on optimism government efforts to boost local economies will support the regional expansion.
The ringgit climbed for the first time in three days as Malaysia prepares to unveil a five-year program to boost its economy by relying less on exports to drive expansion. South Korea’s unemployment rate dropped to a 19-month low, according to a report today, and Manpower Inc. surveys in China and India showed companies plan to increase hiring in the third quarter.
“The Asian region’s growth is going to be strong,” said Nalin Chutchotitham, an analyst at Kasikornbank Pcl in Bangkok. “I am still positive on the Malaysian ringgit, the Thai baht and the Indonesian rupiah because domestic demand for all these countries looks to” be on the uptrend, she said.
The ringgit advanced 0.5 percent to 3.3160 per dollar as of 4:44 p.m. in Kuala Lumpur, according to data compiled by Bloomberg. The rupiah climbed 0.3 percent to 9,257.
Developing Asia may grow 8.7 percent in 2010, outpacing a 3.1 percent expansion in the U.S. and 1.9 percent for Japan, according to estimates released by the International Monetary Fund on April 21. Risks to the global economic outlook have “risen significantly,” the IMF said today, and reiterated that Asia will continue to lead the world economic rebound.
All of Asia’s 10 most-active currencies have strengthened against the euro in the last three months, led by the ringgit, as the European debt crisis raised concerns of sovereign defaults.
The ringgit strengthened from near a two-week low as the FTSE Bursa Malaysia KLCI Index rose for a second day. Prime Minister Najib Razak will outline the Tenth Malaysia Plan in parliament tomorrow, sharing his vision of turning the nation into a high-income economy.
“The plan may be a contributory factor to the ringgit’s strength if the appetite for risk improves,” said Hasdi Mamat, a currency trader at Bank Muamalat Malaysia Bhd. in Kuala Lumpur. “Market volatility is still high and global sentiment remains fragile. This will be a bigger driving force.”
Singapore’s gross domestic product will expand 9 percent in 2010, according to the median forecast in a survey of 19 economists by the Monetary Authority of Singapore released today. That compares with a March estimate of 6.5 percent. Manufacturing will probably increase 16.7 percent, the survey showed, compared with the economists’ previous prediction of a 9.7 percent gain.
Indonesia’s rupiah gained for a second day. The country is “optimistic” it can achieve or exceed export growth of 7 percent to 8.5 percent this year, Trade Minister Mari Pangestu said on June 7. Overseas shipments rose 43 percent in April after surging 47 percent in March, the government said June 1.
Bank Indonesia predicts economic growth will accelerate to 6 percent this year from 4.6 percent in 2009. The government estimates gross domestic product will expand 6 percent to 6.5 percent in 2011.
Manpower, the world’s second-largest provider of temporary workers, said in a survey yesterday that 31 percent of Chinese employers plan to expand their workforce in the third quarter. That was the highest reading since the survey began in 2005. About 42 percent of Indian companies intend to increase their workforce, the most since the three months through December 2008, Manpower said.
The Philippines economic-planning team may raise the low end of the economic growth target for this year to 3.6 percent as early as next week, acting Economic Planning Secretary Augusto Santos said today. The current estimate is a range of 2.6 percent to 3.6 percent.
South Korea’s won slid to a two-week low on concern Europe’s debt crisis will derail the recovery from a global recession. The currency slipped 1.2 percent to 1,248.82 per dollar. The Kospi index dropped 0.3 percent even as the nation’s unemployment rate fell to 3.2 percent in May after reaching 4.8 percent in January, a decade high.
“The market is caught up in the European hysteria,” said Philip Wee, a Singapore-based senior currency economist at DBS Group Holdings Ltd. “But we’re not heading to a double-dip scenario. We’re still on a growth scenario.”
The U.K.’s fiscal challenge is “formidable” and efforts to cut the country’s budget deficit need to be stepped up, Fitch Ratings said yesterday, a day after Germany announced a four-year, 80 billion-euro ($95 billion) package of tax increases and spending cuts. South Korea’s Finance Minister Yoon Jeung Hyun said today he will take “prompt action” should financial markets become more volatile due to Europe’s debt crisis.
The Taiwan dollar ended little changed on speculation the central bank intervened to curb appreciation that may hurt exports. The currency closed at NT$32.52 from NT$32.51 yesterday after rising by as much as 0.7 percent earlier.
Elsewhere, the Philippine peso rose 0.1 percent to 46.57 per dollar, according to Tullett Prebon Plc. The Singapore dollar was little changed at S$1.4158, while the Thai baht was up 0.1 percent at 32.61.
To contact the editor responsible for this story: Sandy Hendry at email@example.com.