Sentiment on emerging Asian currencies improves: Poll

Sentiment on emerging Asian currencies improved in the last two weeks on easing views of an early rate hike by the Federal Reserve while the outlook for the Indonesian rupiah firmed, a Reuters poll showed on Thursday.

Long positions in the rupiah rose on improving economic fundamentals and in spite of some disappointment over election results, according to the survey of 13 analysts conducted between Wednesday and Thursday. Indonesia's trade balance reverted to a larger-than-expected surplus in February.

Investors had hoped the main opposition Indonesian Democratic Party-Struggle (PDI-P) would dominate parliamentary elections on Wednesday. That would have paved the way for popular Jakarta governor Joko "Jokowi" Widodo to win July's presidential election without the help of other parties.

The early count from the vote showed, however, the PDI-P was unlikely to secure enough votes or seats, raising chances of political uncertainty in Southeast Asia's largest economy.

The rupiah led the slide among emerging Asian currencies on Thursday.

Bullish bets on the South Korean won hit their highest level since late November. The won touched a near six-year high on sustained capital inflows from offshore funds.

Sentiment on the Singapore dollar grew to the most optimistic since late October as the central bank was expected to maintain tight monetary policy in its semi-annual policy meeting on Monday.

The Malaysian ringgit's long positions rose to their largest since May 2013 on demand from funds and interbank speculators.

India's rupee reported the largest bullish bets among regional units on stock inflows in the latest positioning survey.

The Chinese yuan continued to post short positions, but sentiment became less pessimistic.

Concerns eased over capital outflows from emerging Asia as investors scaled back expectations on the timing of the Fed's interest rate increase.

Minutes of the U.S. central bank's March meeting showed on Wednesday that Fed officials had worried its forecasts on interest rates might appear to investors as mapping out a more aggressive cycle of rate hikes.

The Reuters survey is focused on what analysts believe are the current market positions in nine Asian emerging market currencies: the Chinese yuan, South Korean won, Singapore dollar, Indonesian rupiah, Taiwan dollar, Indian rupee, Philippine peso, Malaysian ringgit and the Thai baht.

The poll uses estimates of net long or short positions on a scale of minus 3 to plus 3.

A score of plus 3 indicates the market is significantly long U.S. dollars. The figures included positions held through non-deliverable forwards (NDFs).

Post new comment

E-mail ID will not be published
CAPTCHA
This question is for testing whether you are a human visitor and to prevent automated spam submissions.

EDITORIAL OF THE DAY

  • RBI and government intervention is vital if all Indians are to have homes by 2022

    There is a strong case for interest subvention for India’s real estate sector.

FC NEWSLETTER

Stay informed on our latest news!

INTERVIEWS

GV Nageswara Rao

MD & CEO, IDBI Federal Life

Timothy Moe

Goldman Sachs

Chander Mohan Sethi

CMD, Reckitt Benckiser India

COLUMNIST

Varun Dutt

Public perception on climate change

Climate change is already happening; however, surveys conducted in 2008 ...

Parvez Imam

The absoluteness in representations

When a representation replaces the original object or subject, a ...

Dharmendra Khandal

Religion and conservation must go hand in hand

In 1986, former president of WWF International, HRH Prince Philip, ...

INTERVIEWS

William D. Green

Chairman & CEO, Accenture