The Malaysian ringgit traded below its 200-day moving average on Wednesday, falling to 2-month lows at one stage as foreign asset purchases by Malaysian state firms kept the dollar in demand, while the South Korean won slid as importers bought the greenback.
Malaysia's Permodalan Nasional Berhad has reportedly bought landmark London offices for 500 million sterling ($790 million), while Khazanah Nasional said it bought an 9 percent stake in Sri Lankan conglomerate John Keells Holdings for 366 million ringgit.
Dollar bids related to those deals caused interbank speculators to cover short positions in the US currency, forcing the ringgit below its 200-day moving average around 3.0734 per dollar late on Tuesday.
It fell as low as 3.0870, its weakest since January 25 but was later bought on dips, with market players saying dollar purchases linked to the acquisitions appeared to have been completed. The euro rose more on short-covering, helping the Asian unit. "Dollar/ringgit may go to 3.1000, but I am looking to sell it here (around 3.0850). A lot of offers are lined up around 3.0870," said a senior Malaysian bank dealer in Kuala Lumpur.
Dollar/won rose on demand from importers and offshore funds but failed to break through resistance of 1,130, formed by its 55-day moving average and the bottom of the daily Ichimoku cloud. The pair has failed to break above that area since late January and levels above 1,130 are seen by exporters as attractive selling levels, dealers said.
"Dollar/won may head higher eventually, but the market is still seen long-USD and it is difficult to add long positions here," says a foreign bank dealer in Seoul. The Singapore dollar strengthened to 1.2611 per US dollar, with the greenback falling on selling from hedge funds and interbank speculators. Some traders suspect demand for Singapore dollar/ringgit was weighing on US dollar/Singapore dollar. The cross pair rose as high as 2.4450, the highest since January 25 but profit-taking set in ahead of resistance around 2.4500, dealers said.