Most Asian currencies rise

Most emerging Asian currencies rose on Tuesday on hopes of progress in tackling the eurozone debt crisis, but traders were quick to take profits on gains, fearing divided European leaders may again disappoint financial markets. "It is better to sell risk including Asian currencies on any rally as we see very few reasons to be optimistic in the next few weeks," said Frances Cheung, senior strategist for Credit Agricole CIB in Hong Kong.
"There are still political hurdles in European and the economic data in Asia is not helping either," said Cheung. Emerging Asian currencies are headed for a losing month as Europe's deepening crisis takes a toll on investor sentiment. Custodian banks and South Korean exporters sold dollar/won while interbank speculators joined in with some stop-loss selling triggered by a higher euro, dealers said. But local importers bought the pair on dips, limiting its slide, dealers say.
Dollar/won is expected to trade in a range between 1,135 and 1,165. Dollar/ringgit slid on catch-up plays, but interbank speculators covered short positions around 3.1800 as the pair is seen having support around 3.1710 for the day. The pair has channel on the daily chart base at the level. It also has a cluster of highs around 3.1680-3.1700 between November 16-18, which became good support after it broke. Dollar/peso fell as interbank speculators sold on hopes European officials will finally make some progress in tackling the debt crisis. US dollar/Singapore dollar fell through 1.3000 level as a higher euro prompted stop-loss selling by interbank speculators.
The market appears to be settling into the relative comfort of a 1.2900- 1.3200 range for a while pending new factors. Dollar/baht edged up on month-end corporate demand in Thailand although some dealers sighted Japanese investors buying the baht, probably linked to re-insurance for those affected by recent flooding. Some offshore funds bought the pair as its recent pullback has been shallow, perhaps highlighting dollar strength. Analysts advised buying dollar/baht on dips to 31.20 with a 30.90 stop for 32.00-32.10. But it may find resistance from exporters, dealers said.
Dollar/rupiah rose amid thin liquidity as offshore players continued to buy the pair, though only modest bond outflows have been seen so far this month. But the Indonesian central bank said it remained in the currency market, intervening by selling dollars, to stabilise the local currency. The Bank Indonesia has been spotted selling dollars to stem the pair's gains, dealers said.