Breaking News
Investing Pro 0
🚨 Our Pro Data Reveals the True Winner of Earnings Season Access Data

Asian currencies benefit from Sino-U.S. trade deal hopes: Reuters poll

Stock Markets Oct 24, 2019 06:01AM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
Add to/Remove from Watchlist
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio

By Aby Jose Koilparambil

(Reuters) - Sentiment toward most Asian currencies picked up in the past two weeks, a Reuters poll showed, amid positive signals that trade tensions between the United States and China waning.

Hopes of a resolution gained momentum after U.S. President Donald Trump said a deal could be signed by the time Asia-Pacific Economic Cooperation (APEC) meetings take place in Chile in mid November.

U.S. Trade Representative Robert Lighthizer tempered the expectations, saying that the administration was aiming to finalize a deal on the first phase of the agreement in time for the APEC meetings.

Tit-for-tat tariffs imposed by the world's two biggest economies on each other's goods have roiled financial markets for more than a year now and fueled worries about an economic downturn, with the International Monetary Fund forecasting global growth to weaken to 3% in 2019, the slowest pace in a decade.

"The rationale behind the trend (of recent strengthening in regional currencies and prospective further firmness) is the de-escalation of China-U.S. trade tensions to some extent," said Mitul Kotecha, senior emerging markets strategist at TD Securities.

The dollar has come under significant pressure in recent times and that has turned beneficial for the emerging market currencies, Kotecha said.

Investors turned bullish on the Singapore dollar for the first time since April end, and switched to long positions on the Philippine peso since early August.

Bullish bets were back on Indonesia's rupiah as well, after going short in the previous two polls.

Underpinning the broader positive sentiment, investors scaled back short positions on the Chinese yuan , the Korean won , the Indian rupee and the Malaysian ringgit , according to a Reuters poll of 15 respondents.

Short bets on the yuan and the Indian rupee are at their lowest since mid July and mid August respectively, while bearish bets on the won are at the weakest level since switching from long positions in January.

"The central banks (in Asia) keep on easing policy and with inflation remaining low, the inflows into the region will strengthen and that will benefit the currencies," Kotecha added.

On Thursday, Indonesia's central bank cut its benchmark rate for a fourth time since July, as it seeks to spur growth in an economy that is likely to slow this year.

A couple of weeks back, Singapore's central bank eased monetary policy for the first time in three years, as widely expected, while South Korea has kept the door open and Malaysia too might opt for another cut.

Other factors have also contributed to the positive sentiment, with the rupiah slated to appreciate further on expectations of continued fiscal discipline after Indonesian Finance Minister Sri Mulyani Indrawati retained her position in the new cabinet.

The Reuters survey is focused on what analysts believe are the current market positions in nine Asian emerging market currencies: the yuan, the won, the Singapore dollar, the rupiah, the Taiwan dollar , the Indian rupee, the Philippine peso, the 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 on U.S. dollars. The figures included positions held through non-deliverable forwards (NDFs).

Asian currencies benefit from Sino-U.S. trade deal hopes: Reuters poll

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.
  • Any comment you publish, together with your profile, will be public on and may be indexed and available through third party search engines, such as Google.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at’s discretion.

Write your thoughts here
Are you sure you want to delete this chart?
Post also to:
Replace the attached chart with a new chart ?
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Are you sure you want to delete this chart?
Replace the attached chart with a new chart ?
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Continue with Google
Sign up with Email