Investors put their bearish views on the majority Asian Currencieswith small bets on the Indian Rupee At nearly two-year highs, Russia’s invasion of Ukraine has supercharged commodity prices and stoked inflation concerns, a Reuters poll showed on Thursday.
A survey of 13 respondents showed that market participants Singapore dollar and significantly expanded short bets South Korean WonThe taiwanese dollar And this Philippine Peso,
The invasion, which Russia calls a “special operation”, has turned investors away from riskier emerging markets and caused regional bond yields to spike, as rising prices raised concerns over how the pandemic was going to hit. Recovering economies will manage high inflation in the face of slow growth. ,
Net energy importers such as India are most at risk, as oil prices could increase inflation risk at a time when retail inflation has already crossed the upper limit of the central bank’s tolerance band.
As a result, bearish bets on the rupee reached its highest level since April 2020. The currency had hit a record low on Monday.
Analysts at DBS Bank said in a note on Wednesday that a cut in fuel excise duty may be necessary to offset the hit from higher prices, which would widen India’s current account deficit and dent the central bank’s partisan bias in “tough areas”. “Will put it in.
Investors were also short on Indonesia’s rupiah and Malaysia’s ringgit, although currencies fell on the back of major commodity exporting countries, which would benefit from skyrocketing prices.
Nevertheless, commodity exports pose risks, according to Vishnu Varthan, head of economics and strategy at Mizuho Bank.
“While the IDR’s coal export offset provides an involuntary backstop against ‘risk off’, it highlights a single point of failure, a domestic shortfall, should coal export restrictions be imposed. In contrast to tightening restrictions on palm oil exports No.”
Bullish bets on the Chinese yuan, which has emerged as a regional haven during the Russia-Ukraine conflict, subsided but were still largely healthy.
The yuan was trading almost flat against the US dollar at 6.32 on Thursday. It rose to its highest level in nearly four years last week, prompting major state-run banks to buy the greenback to rein in the bullish currency.
The Thai baht sharply cut long positions as the country’s tourism sector is likely to decline due to conflict in tourists from Russia and fuel prices from elsewhere, and put pressure on another net oil importer.
The Asian Currency Position Survey focuses on what analysts and fund managers believe are the current market conditions in nine Asian emerging market currencies: Chinese Yuan, South Korean Won, Singapore Dollar, Indonesian Rupiah, Taiwan Dollar. , Indian Rupee, Philippine Peso, Malaysian Ringgit and 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 that the market is long enough for the US dollar.
These figures include positions held through non-deliverable forwards (NDFs).
A survey of 13 respondents showed that market participants Singapore dollar and significantly expanded short bets South Korean WonThe taiwanese dollar And this Philippine Peso,
The invasion, which Russia calls a “special operation”, has turned investors away from riskier emerging markets and caused regional bond yields to spike, as rising prices raised concerns over how the pandemic was going to hit. Recovering economies will manage high inflation in the face of slow growth. ,
Net energy importers such as India are most at risk, as oil prices could increase inflation risk at a time when retail inflation has already crossed the upper limit of the central bank’s tolerance band.
As a result, bearish bets on the rupee reached its highest level since April 2020. The currency had hit a record low on Monday.
Analysts at DBS Bank said in a note on Wednesday that a cut in fuel excise duty may be necessary to offset the hit from higher prices, which would widen India’s current account deficit and dent the central bank’s partisan bias in “tough areas”. “Will put it in.
Investors were also short on Indonesia’s rupiah and Malaysia’s ringgit, although currencies fell on the back of major commodity exporting countries, which would benefit from skyrocketing prices.
Nevertheless, commodity exports pose risks, according to Vishnu Varthan, head of economics and strategy at Mizuho Bank.
“While the IDR’s coal export offset provides an involuntary backstop against ‘risk off’, it highlights a single point of failure, a domestic shortfall, should coal export restrictions be imposed. In contrast to tightening restrictions on palm oil exports No.”
Bullish bets on the Chinese yuan, which has emerged as a regional haven during the Russia-Ukraine conflict, subsided but were still largely healthy.
The yuan was trading almost flat against the US dollar at 6.32 on Thursday. It rose to its highest level in nearly four years last week, prompting major state-run banks to buy the greenback to rein in the bullish currency.
The Thai baht sharply cut long positions as the country’s tourism sector is likely to decline due to conflict in tourists from Russia and fuel prices from elsewhere, and put pressure on another net oil importer.
The Asian Currency Position Survey focuses on what analysts and fund managers believe are the current market conditions in nine Asian emerging market currencies: Chinese Yuan, South Korean Won, Singapore Dollar, Indonesian Rupiah, Taiwan Dollar. , Indian Rupee, Philippine Peso, Malaysian Ringgit and 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 that the market is long enough for the US dollar.
These figures include positions held through non-deliverable forwards (NDFs).