Emerging Asian currencies rose on Wednesday with the rupiah gaining on hopes for more inflows after Moody's upgraded Indonesia's sovereign rating, while the won and ringgit broke through technical resistance levels. Earlier, Moody's Investors Service raised Indonesia's credit status to an investment grade, a status likely to draw more fund flows into Southeast Asia's biggest economy. Fitch Ratings had upgraded the country's sovereign rating in December.
After the Moody's move, the rupiah rose against the dollar and the Jakarta stock market turned positive. Other Asian currencies such as the Indian rupee and the South Korean won also rose on foreign inflows into their stock markets. Some dealers and analysts expect more funds to flow in as risk appetite improves, though there was some caution ahead of a Portuguese debt sale and fractious talks over restructuring Greece's debt.
Dollar/won breached support at its 55-day moving average at 1,144.6 as foreign investors continued to buy South Korean stocks. The pair earlier found some relief from importers' demand for settlements, but offshore funds and stop-loss sales pushed down it to as low as 1,140.2, the weakest since December 12, dealers said.
Dollar/won has room to fall more, probably to a 100-day moving average of 1,138.7. Dollar/ringgit fell below a Fibonacci retracement support as some speculators looked to sell the pair on rallies on improved risk appetite. Leveraged names also sold it. Dollar/ringgit may head to 3.10, the 61.8 percent Fibonacci retracement of its October-December rise, if it ends the day lower than the 50 percent level around 3.12. Investors added short Dollar/Philippine peso positions, while the central bank's agent players have been spotted buying around 43.50, dealers said.
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