Asian FX set for weekly gains

Emerging Asian currencies are poised for their first weekly gain since late October buoyed by the joint central bank action and some short-covering, although caution ahead of the US jobs data and dollar-buying by regional central banks kept them subdued on Friday.
"A rise of between 125,000 and 150,000 will not produce mush response from Asian currencies," said Jonathan Cavenagh, foreign exchange strategist for Westpac in Singapore. A figure above 175,000 may boost the regional currencies, particularly the South Korean won, the Malaysian ringgit and the Singapore dollar, around 0.5 percent, he added.
In the last week of October, emerging Asian currencies rose after the euro zone's leaders agreed on a plan to ease the continent's debt problems. But later, most emerging Asian currencies continued to suffer weekly losses. Suresh Kumar Ramanathan, regional rates and foreign exchange strategist for CIMB Investment Bank in Kuala Lumpur, said he doesn't expect Asian currencies to rise further, as risk aversion remains high as do fears of possible sovereign defaults in Europe.
The won rose 2.9 percent against the dollar for the week, outperforming its Asian peers, according to Thomson Reuters data, as a central bank in central Asia bought the local currency for the country's bonds. The ringgit, the second best performing among emerging Asian currencies, has gained 2.2 percent on the week. US dollar/Singapore dollar edged up on short-covering on caution over possible intervention and on weaker stocks. There was market talk on Thursday that agent banks of Singapore central bank was seen to keep the pair above 1.2800, dealers said.
Dollar/ringgit fell on interbank speculators selling triggered by a higher euro, breaking support of 3.1380, the 38.2 percent Fibonacci retracement of its rise between late October and November. Dollar/baht fell below a 55-day moving average, staying around the 61.8 percent Fibonacci retracement of its increases between late October and November. The pair edged down to 30.830, breaking through the average of 30.870 and near the retracement of 30.822.