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Most Asian FX bears firm; short bets on yuan at near 1-year high

04/08/2021 | 01:21am EDT
A cashier checks Indian rupee notes inside a room at a fuel station in Ahmedabad

    * Investors most bearish on Taiwan dollar since Aug. 2019
    * Short bets on won, ringgit, Singapore dollar trimmed

    By Shashwat Awasthi
    April 8  - Bearish bets on most Asian currencies firmed, a Reuters poll showed on
Thursday, as signs of an economic recovery in the United States and rising coronavirus cases
across the region dented the appeal of risk-sensitive assets.
    Short bets on the Chinese yuan were at their highest since May, while those on
the Philippine peso and the Thai baht inched up to remain at a near one-year
high, a poll of 11 respondents showed.
    Investors had turned short on all Asian currencies for the first time in a year last month
as economic indicators increasingly suggest a recovery in the United States will outpace other
developed nations, boosting U.S. Treasury yields and the dollar.
    The greenback enjoyed its best performance in three years in the first quarter of 2021 and
has continued to rise steadily since.
    The poll responses, however, came before the Federal Reserve's latest minutes on Wednesday.
The central bank reaffirmed its loose monetary policy stance but offered no new catalysts, which
took some shine off yields and the dollar.
    Fresh waves of COVID-19 infections and record deaths in several Asian countries have also
led to uncertainty in emerging market currencies.
    The Indian rupee saw short positions rise to their highest level since May.
    The Reserve Bank of India (RBI) on Wednesday kept interest rates at record lows but
committed to a massive government bond purchase program, following which the rupee suffered
its worst day in more than one-and-a-half years.
    "One possible catalyst for yesterday's decision could be India's daily case numbers of
COVID-19, which have taken India to the unenviable position of the world's most infected country
on a daily basis," said Robert Carnell, regional head of research, Asia-Pacific at ING.
    "Low official and market rates have not done much to bring down bank lending rates, so it
might be a push to suggest that this latest move will offset the COVID-19 impact by boosting
lending and real activity."
    Market participants were the most bearish on the Indonesian rupiah since October.
    Earlier this week, a senior official of Indonesia's central bank said the currency was "too
cheap" against the dollar and had been weakened by a spillover effect of U.S. fiscal policies.

        
    The Asian currency positioning poll is focused on what analysts and fund managers 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 include positions held through non-deliverable forwards (NDFs).
    The survey findings are provided below (positions in U.S. dollar versus each
currency):
    
  Date    CNY    KRW    SGD    IDR    TWD    INR    MYR    PHP    THB
 08-Apr  0.72   0.48   0.30   0.59   0.77   0.20   0.46   0.36   0.91
 25-Mar  0.30   0.65   0.46   0.45   0.50   0.05   0.54   0.11   0.54
 11-Mar  -0.06  0.55   0.55   0.22   -0.10  -0.37  0.50   0.09   0.49
 25-Feb  -1.03  -0.32  -0.57  -0.51  -0.58  -0.96  -0.13  0.01   -0.37
 11-Feb  -0.91  -0.24  -0.29  -0.36  -0.63  -0.53  -0.04  -0.47  -0.41
 28-Jan  -1.08  -0.64  -0.79  -0.41  -0.68  -0.55  -0.3   -0.66  -0.36
 14-Jan  -1.21  -0.87  -0.83  -0.57  -0.89  -0.22  -0.3   -0.8   -0.5
 10-Dec  -1.53  -1.68  -1.11  -0.61  -1.6   -0.2   -0.53  -0.97  -0.87
 26-Nov  -1.43  -1.29  -1.01  -0.92  -1.08  -0.3   -0.75  -0.8   -0.66
 12-Nov  -1.28  -1.52  -0.99  -1.01  -1.08  -0.26  -0.44  -0.67  -0.8
 29-Oct  -0.86  -1.14  -0.49  0.09   -1.23  -0.07  -0.03  -0.09  -0.02
 
    
 (Reporting by Shashwat Awasthi and Nikhil Kurian Nainan in Bengaluru; Editing by Amy Caren
Daniel)
  
 
 

© Reuters 2021
Stocks mentioned in the article
ChangeLast1st jan.
AUSTRALIAN DOLLAR / INDIAN RUPEE (AUD/INR) 0.00% 57.491389 Delayed Quote.1.93%
AUSTRALIAN DOLLAR / US DOLLAR (AUD/USD) 0.74% 0.78433 Delayed Quote.1.22%
BANK OF INDIA LIMITED -0.88% 67.65 End-of-day quote.39.05%
BRITISH POUND / US DOLLAR (GBP/USD) 0.68% 1.39885 Delayed Quote.1.61%
CANADIAN DOLLAR / INDIAN RUPEE (CAD/INR) 0.00% 60.377 Delayed Quote.5.52%
CANADIAN DOLLAR / US DOLLAR (CAD/USD) 0.00% 0.8233 Delayed Quote.4.73%
EURO / INDIAN RUPEE (EUR/INR) 0.43% 89.188 Delayed Quote.-0.51%
EURO / US DOLLAR (EUR/USD) 0.81% 1.21625 Delayed Quote.-1.22%
INDIAN RUPEE / US DOLLAR (INR/USD) 0.00% 0.013643 Delayed Quote.-0.75%
MSCI TAIWAN (STRD, UHD) 2.17% 708.994 Real-time Quote.14.50%
NEW ZEALAND DOLLAR / US DOLLAR (NZD/USD) 0.70% 0.72793 Delayed Quote.0.73%
UNITED STATES DOLLAR (B) / CHINESE YUAN IN HONG KONG (USD/CNH) 0.00% 6.4158 Delayed Quote.-1.22%
US DOLLAR / CHINESE YUAN RENMINBI (USD/CNY) 0.00% 6.431 Delayed Quote.-1.00%
US DOLLAR / INDIAN RUPEE (USD/INR) -0.39% 73.3 Delayed Quote.0.76%
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