Investors turned bearish on most emerging Asian currencies in the last two weeks as Europe's debt crisis deepened, though they slightly raised positions in the Chinese yuan, a Reuters poll showed on Thursday. The survey of 12 currency analysts, conducted over two days, found investors turned pessimistic on the Singapore dollar, reducing bets on the city-state's currency by the most since April 2009.
Currency players also became the most bearish on the Indian rupee since mid-September. The Reuters survey focused on what analysts believe are the current market positions in eight Asian emerging market currencies: Chinese yuan, South Korean won, Singapore dollar, Indonesian rupiah, Taiwan dollar, Indian rupee, Philippine peso and Malaysian ringgit.
For the Singapore dollar, 10 out of 12 analysts were bearish, while two were bullish. The local dollar on Thursday breached a technical support line. All of the analysts were bearish on the rupee. The Indian currency may retest a record low of 52.20 per dollar on a widening trade deficit, falling car sales and a Moody's outlook downgrade of the country's banking sector.
The poll result came as worries about the European debt crisis intensified, with surging Italian borrowing costs suprring fears of a eurozone break-up. In the previous survey published on October 27, investors had turned bullish on the won and some of its Asian peers on optimism over possible steps to contain the eurozone's debt problems. 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 dollars. The figures included positions held through non-deliverable forwards (NDFs).
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