Emerging Asian currencies slide

Emerging Asian currencies slid on Friday and were on course for weekly losses as investors cut risky positions on increasing doubts that European leaders can produce a credible scheme to ease the debt crisis in the summit. Some, including the South Korean won and the Singapore dollar, broke through technical support lines, suggesting further weakness ahead.
A European Union (EU) diplomat said leaders had agreed the eurozone's permanent bailout fund will now have a banking license, which could cap its firepower to tackle the sovereign problems. On Friday, Nomura analysts said they expect regional units to fall next year, as the risks of European deleveraging and repatriation as well as weaker growth and rate cuts in Asia were not fully priced in. Investors stayed bearish on most emerging Asian currencies in the last two weeks, although they turned slightly bullish on the won, a Reuters poll showed.
Dollar/won rose on demand from South Korean importers, offshore funds and custodian banks, while local exporters limited the local currency's weakness. The pair gained to as high as 1,148.4, a shy of the 61.8 percent Fibonacci retracement at 1,148.5 of its slide between late November and early October. But it broke through the 50 percent retracement and a 55-day moving average.
The won lost 1.3 percent against the dollar for the week. US dollar/Singapore dollar broke through the pivotal resistance at 1.2980-1.3000 on short squeezes. Leveraged and macro accounts were seen large buyers from the 1.2940 level. The pair is seen heading to 1.3060, the 76.4 percent retracement of its slide between late November and early October.
Long US dollar positions against the Singapore dollar have moderated, a Reuters survey showed, so positioning may not be an impediment to further dollar gains. Short-covering lifted dollar/ringgit to as high as 3.1630, above the 50 percent retracement of its slide between late November and early October. If the pair ends the day above the retracement of 3.1957, it may rise to 3.1687, the 61.8 percent retracement. Dollar/Philippine peso opened higher as non-deliverable forward premiums jumped overnight.