Asian currencies riding high on false rally - ANZ

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Oct 9, 2015.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

    Oct 7, 2015
    Likes Received:
    FXStreet (Delhi) – Khoon Goh, Research Analyst at ANZ Research, suggests that while a delay in Fed rate hike expectations may have been the catalyst for the sharp rally in Asian currencies this week, we do not believe this is the start of a turnaround.

    Key Quotes

    “The moves largely reflected market positioning, exacerbated by a lack of liquidity in some markets.”

    “We still see challenging times ahead for Asian currencies as slowing growth; deleveraging and prospects for further policy easing ultimately see depreciation pressure return.”

    “Therefore, we recommend initiating long positions in USD/KRW and USD/TWD, as we see these two currencies as most vulnerable – particularly to a slowdown in China.”

    “We also recommend going long PHP against SGD ahead of the MAS meeting, were we expect a re-centring of the policy band to the prevailing S$NEER level.”
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