Taiwan dollar, rupee gain in Asian trade

The Taiwan dollar and the Indian rupee gained on Thursday helped by inflows, but the outlook for emerging Asian currencies remained weak on sustained worries about the euro zone's sovereign funding problems and a slowing global growth. The Thai baht underperformed its Asian peers as offshore sold, while most of the regional units were little changed before a Spanish bond auction and the European Central Bank's policy meeting later in the day.
US dollar/Taiwan dollar hit its lowest in more than two months on stock inflows. But the pair recovered some of its earlier loss as local interbank speculators covered short positions, while the central bank was also spotted buying for intervention, dealers said. Importers also joined the bids.
Dollar/rupee fell on inflows into local bonds, as well as selling from funds and exporters, especially after strong factory data. Dollar/won was barely changed as supplies from exporters and some offshore funds offset importers demand. "Local sentiment still favoured long positions, but market forces did not help much. Dollar/won will eventually fall, I think," said a senior foreign bank dealer.
Meanwhile, Swedish bank SEB advised selling rupee/won as it views the recent appreciation in the Indian currency as temporary and expects the won to strengthen more. Rupee/won edged down to 22.3574. Offshore funds and Thai importers bought dollar/baht, but some local interbank speculators looked to sell the pair, saying market players appeared to hold long positions to clear.
A local bank trader in Bangkok said he'd like to start building up short positions around the session's high of 31.86. The baht has lost 0.8 percent against the dollar so far this year, becoming the second-worst performing Asian currency after the Indonesian rupiah, according to Thomson Reuters' data. Indonesian companies and foreign funds bought dollar/rupiah, while the central bank sold the pair below 9,180, to cap its rises, dealers said.
Meanwhile, Westpac said dollar/rupiah has room to fall, given foreign investors demand for the Indonesian stocks and foreign holdings of the country's bonds have been steady since late 2011. Westpac said in a note it is short one-month dollar/rupiah non-deliverable forwards (NDFs) from 9,215.