Dollar sinks in Asia on US debt fears
AFPTOKYO--The U.S. dollar fell in Asia on Monday as investors fear a U.S. budget deadlock in Washington could continue past a mid-October deadline to raise the country's borrowing limit and cause a devastating default.
October 8, 2013, 12:08 am TWN
The greenback bought 97.10 yen in Tokyo, against 97.47 yen in New York Friday afternoon.
The euro fetched US$1.3568 and 131.78 yen, compared with US$1.3557 and 132.14 yen.
Traders are buying the safe-haven yen on concerns U.S. lawmakers — whose face-off has forced a government shutdown — will not strike a budget deal before Oct. 17, when the government runs out of cash to pay its bills and could in turn default.
A similar showdown in 2011 saw the borrowing limit raise at the last minute but not before global stock markets tumbled while the crisis caused the downgrade of Washington's sovereign debt rating.
U.S. Treasury Secretary Jack Lew warned Sunday that Congress was “playing with fire” as Republican House leader John Boehner said the party would not raise the U.S. debt ceiling without spending cuts.
The government shutdown, which is entering its seventh day, has also affected the release of U.S. economic data with no clarity on when key nonfarm payrolls data, originally due out last week, will be published.
The dollar was mixed against other Asia-Pacific currencies.
It slipped to 11,212 Indonesian rupiah from 11,371 rupiah on Friday while holding steady at 1,071.29 South Korean won.
The dollar edged up to 61.80 Indian rupees from 61.45 rupees, to SG$1.2480 from SG$1.2473, to 43.13 Philippine pesos from 43.09 pesos, and to 31.29 Thai baht from 31.24 baht.
The Australian dollar slipped to 94.18 U.S. cents from 94.36 cents, while the Chinese yuan changed hands at 15.86 yen against 15.88 yen.