Think before you unload your US$ investments, Bruneians told

INVESTORS should consider holding on to their US dollar holdings and avoid the herd mentality that favours selling off before the weakening currency starts to drop, a currency economist told Bruneian investors yesterday.

"One of the madness that is going around now is the fact that you should drop your US currencies, and we feel that you shouldn't," Phillip Wee, senior currency economist from DBS Bank, said at a currency talk for Baiduri Prestige customers at The Empire Hotel & Country Club.

The US dollar will be "quite powerful" in the coming months, he said.

"When the global recovery returns, the economies to look out for are the economies that can spend money, and right now those economies are China and Asia."

In the early 1980s when there was a US dollar crisis, the Japanese yen became strong and in 1990 the world experienced the Nikkei bubble burst, he said. "In the early 1990s Asia was booming with investments from the US and after that we experienced the Asia crisis, which led Asia to start investing in the US technology sector," he said.

"You can notice a trend that is going back and forth from Asia to the US. So right now with the US going through the credit crisis, the question is whether China and Asia will come to the rescue to boost up the US dollar? If we follow the trend, it will tell us that the answer is yes and that the US dollar will strengthen again," he said.

It will be noted that the US dollar drifted lower after the release of better than expected US jobs data, which fed optimism about the end of the US economic recession.

About 100 registered Prestige customers attended the currency talk yesterday.

Alvina Chung, manager of Baiduri Prestige, said the talk went hand in hand with one of the products that is currently being offered by Baiduri Bank, the long-term investment product Baiduri Twin Currency Deposit.

"Some of our Baiduri Prestige customers are also investors of the Baiduri Twin Currency Deposit product, so this will give them a better insight on what to do with their investment," said Alvina.

The Brunei Times