Most Asian currencies rally

Asia's major economies took policy action on Thursday as they struggled to deal with the impact of inflows of hot money, while central banks in the region intervened to halt a sustained rally of their currencies. Singapore's central bank surprised markets by widening for the fist time in 9 years the band in which it lets its dollar trade, propelling the currency to a record high and fanning widespread US dollar selling.
South Korea's central bank kept interest rates on hold out of concern that higher rates would have sucked in more foreign capital, boosted the won, and undermined exports. The South Korean won rose 1 percent against the dollar on expectation of further US quantitative easing and after Singapore widened the trading band for its currency that prompted additional rises in Asian currencies. The won faced resistance at 1,110 per dollar after the central bank left interest rates on hold amid concern over its strength on the economy.
Dealers suspected the foreign exchange authorities of buying dollars. The won was quoted at 1,109.65, up 1.0 percent from its previous close of 1,120.7. The Thai baht rose a quarter percent, inching toward a fresh 13-year high in moderate trade in tandem with a broad Asian rally and prompting intervention by the Bank of Thailand.
Dollar/baht was bid at 29.81 at 0542 GMT against 29.88 late on Wednesday. The baht has gained 3.3 percent in the past month and 11.8 percent this year, making it the second-strongest Asian currency after the yen. The Malaysian ringgit gained a third of a percent in early trade, taking its cue from a bullish Singapore dollar, which has risen 0.7 percent against the dollar after the MAS tightened its monetary policy. The ringgit has gained 0.71 percent in the past month and 11 percent this year, the third-strongest Asian currency after the yen and baht. Dollar/ringgit NDFs were bid down across the curve with the six-month dollar/ringgit NDFs falling to 3.0980 from 3.1025 late on Wednesday and against 3.0815 spot, implying a 0.53 percent six-month depreciation from the spot.