Bearish bets on won largest since 2008 crisis

Investors built up the largest short positions in the South Korean won since the 2008 global financial crisis in the last two weeks as sentiment towards most emerging Asian currencies soured as the yen hit multi-year lows, a Reuters poll showed. Long positions on China's yuan, however, rose slightly on expectations of inflows thanks to a new link between the Hong Kong and Shanghai stock exchanges.
Bearish bets on the won rose to the largest since October 2008, according to the survey of 15 currency analysts and traders conducted between Tuesday and Thursday. The won fell to a near 15-month low against the dollar on Thursday. That came as the yen slid to a seven-year low against the dollar and a six-year trough versus the euro as speculators rushed into carry trades funded by super-cheap liquidity from the Bank of Japan. The won is seen as more sensitive to the yen's weakness, given the rivalry between South Korean and Japanese exporters. The Taiwan dollar also saw its most bearish bets since April 2009 on fears that the island's exporters are losing competitiveness due to the weakness of the yen and won.
Short positions in the Singapore dollar also rose to the highest since the same period. It fell on Thursday to 1.3012 per US dollar, its weakest since December 2011, and traders said the central bank was spotted intervening to stem the depreciation. Bearish bets on the Malaysian ringgit rose to their largest since August 2013 on concerns over the slowing economy and the impact of lower oil prices.
With the regional mood bearish, the Indonesian rupiah failed to retain bullish bets although the central bank raised interest rates and the government increased fuel prices earlier this week. The previous survey showed sentiment on the rupiah turned bullish for the first time since mid-August.
Long bets on the Indian rupee were also trimmed. The Reuters survey is focused on what analysts believe are the current market positions in nine Asian emerging market currencies: the Chinese yuan, South Korean won, Singapore dollar, Indonesian rupiah, Taiwan dollar, Indian rupee, Philippine peso, Malaysian ringgit and the Thai baht. The poll uses estimates of net long or short positions on a scale of minus 3 to plus 3. A score of plus 3 indicates the market is significantly long US dollars. The figures included positions held through non-deliverable forwards (NDFs).