Most emerging Asian currencies strengthened on Friday and were set for weekly gains as a series of hefty global stimulus measures against the coronavirus eased a dollar funding crunch.
Global incentives to arrest virus-driven economic losses revived demand for riskier assets like Asian currencies, breaking a two-week rally in the greenback and setting it on course for the biggest weekly fall in more than a decade.
China's dismal industrial data and a record surge in US weekly jobless claims bolstered hopes of more support measures from the world's two largest economies, though a steady rise in global virus infections tempered risk sentiment.
"The gains in equities and Asian currencies this week do not truly reflect market confidence that the coronavirus outbreak has peaked and that the economic turmoil is over, despite the promise of more economic rescue packages in the pipeline," Han Tan, a market analyst at FXTM said.
"The risk that the rebound in stock markets may prove to be a false dawn, one fuelled by volatility rather than fundamentals, warrants a cautious stance by investors."
Leading gains in the region, the South Korean won advanced as much as 2.2% to 1,206 per dollar, its strongest level in more than two weeks.
The Thai baht gained 0.9%, the best intraday performance since June 20, 2019.
Thailand's finance minister said that the government has enough funds to alleviate the impact of the outbreak, and a plan to preserve jobs is also in the works.
Malaysia's ringgit strengthened 1.3% before an announcement for a second stimulus package.
The Indian rupee surged up to 1%, a day after the government announced a $22.6 billion relief package to help the poor cope with disruptions due to a lockdown.
India's central bank also slashed interest rates by 75 basis points on Friday.
The Indonesian rupiah rose 1.4% on resurgent demand for local bonds, while equities surged nearly 8%.
The central bank governor on Thursday said there were no plan for capital control measures to stem outflows, saying its foreign exchange reserve is more than enough to prop up the currency.
The rupiah is the worst hit currency in the region, losing about 13.5% so far this year.