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Asian currencies eased on Friday as investors took profits after disappointing earnings from US technology giants, although they were mainly poised for weekly gains amid signs the global economy is stabilizing. The Malaysian Ringgit lost 0.4 percent as interbank speculators covered dollar-short positions, while the Philippine peso slid on speculation of a rate cut by the central bank next week.

The South Korean won led weekly gains among emerging Asian currencies with a 0.7 percent climb against the dollar. Offshore funds and domestic exporters chased the local currency. The Taiwan dollar has risen 0.4 percent against the greenback so far this week, while the ringgit and the Chinese yuan have both gained 0.3 percent, according to Thomson Reuters data.

The Singapore dollar has advanced 0.2 percent, the data showed. The ringgit earlier weakened past 3.0476 per dollar, the 38.2 percent retracement of its appreciation since October 10 on dollar-short covering. Technical charts indicated that the Malaysian currency may head to 3.0543, the 50.0 percent retracement, if it ends the day weaker than the 38.2 percent level.

Philippines Peso

The Bangko Sentral ng Pilipinas (BSP) said it stands ready to temper the peso’s appreciation against the dollar, which an analyst said is an indication of further monetary easing next week.

“We will not tolerate excesses in exchange rate movements and will not hesitate to consider other tools in our policy toolkit,” BSP Governor Amando Tetangco Jr. said in a text message to reporters.

This is, by far, BSP’s boldest statement with regard to the continued strength of the peso against the dollar with previous statements only centered on allowing the currency to be generally market determined.

A strong peso, while making imports cheaper, also trims the value of dollar export earnings and remittances from overseas Filipinos when converted into local money.

“Peso is fundamentally supported. Our official action is to minimize excessive volatility. If the flows are structural, we will allow the peso to appreciate,” Tetangco said last Oct. 5.

Since then, however, the peso has achieved new highs, the last of which was last Wednesday when it closed at 41.18 to a dollar.

The closing last Wednesday was the highest in 55 months and from the last trading day of 2011 until that day, the peso already appreciated by 6.06 percent.

Tetangco said BSP realizes that the country has become attractive to yield-seeking inflows abroad “as uncertainty continued to hover around the resolution of the European crisis.”

Philippine interest rates stand at 3.75 percent and 5.75 percent for overnight borrowing and lending, respectively after BSP cut them thrice this year. These rates however remain above the near-zero interest rates prevailing in debt-ridden developed markets, thus, attracting investments.

“The Philippines has continued to be a recipient of flows, which in turn have supported the peso. We are mindful of developments both global and domestic and we are watchful of market conduct,” the BSP chief said.

Emilio Neri, an economist at the Bank of the Philippine Islands, said Tetangco’s remarks could be an indication of what will be BSP’s decision next week.

“I think what the Governor is saying is that we do not want the people generating dollars for the country sort of ostracized by the appreciating peso. It’s a way of saying that it is a little overdone for the peso,” Neri said in a phone interview.