The high-yielding Indonesian rupiah led Asian currencies higher on Monday as investors' appetite for riskier assets rose due to tentative signs that the global economy was improving. Asian stocks hit a seven-month high as a survey on China's factories offered fresh evidence the global economy may be picking up following reports on Friday that showed US consumers felt more confident about the economy in April.
RUPIAH The Indonesian rupiah soared just over 1 percent to 10,440 per dollar, a seven month high. "Dollar/rupiah is lower due to offshore selling," said a trader in Jakarta. The rupiah, the best performer in Asia, has risen almost 4.7 percent against the dollar so far this year due to rising optimism about the country's political stability in the 2009 election year and its economic resilience.
Meanwhile, one-year offshore dollar/rupiah non-deliverable forwards fell to 11,360, pricing in a 7.5 percent rupiah fall from the spot compared to 8 percent on Friday. One-year NDFs implied a 0.4 percent discount over onshore forwards with the same tenor compared to 0.2 percent on Friday.
PESO The Philippine peso rose as much as 0.5 percent to 48.10 per dollar on risk-taking while dollar/peso NDF curve shifted lower. "Dollar/peso fell today alongside the broad dollar down move. The long weekend led to the accumulation of larger than usual remittance inflows which pushed dollar/peso lower," said a Manila-based trader.
One-year offshore NDFs dropped to 49.66, pricing in a 3 percent peso weakening from the spot while onshore forwards price in a 2 percent peso fall. Some traders also pointed to technical signals suggesting that the peso's rally may reverse in the near term as its current level was the 61.8 percent Fibonacci retracement of the peso's decline from 47.62 on April 16 to 48.995 on April 28.
WON The South Korean won hit a four-month high against the dollar on Monday as strong data boosted hopes that the global economic slowdown may be easing and Seoul stocks rallied. The won found more support as the central bank injected less foreign currency into the local money market than planned, an indication the banking sector's foreign currency liquidity problems may be easing.
"The won is likely to go to 1,250 (per dollar) soon as the overall mood is much better than expected. Healthy indicators at home and abroad have kept fuelling hopes for a recovery," said Jeon Seung-ji, a currency analyst at Samsung Futures Inc. The South Korean unit was quoted at 1,272.4/3.1 per dollar as, compared with Thursday's domestic close of 1,282.0. It strengthened to as firm as 1,264.9, the strongest since December 31, 2008.
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