source: ANZ
"The selloff in Asian currencies since early May has been relentless. Key resistance levels have been broken (USD/TWD and USD/MYR) or threatened (USD/SGD, USD/THB), and new lows against the USD was reached for INR. Our ANZ AXJ Index fell 3.2% over May, and is now down 1.0% year-to-date. The reasons for the poor Asian currency performance can be pinned down to a strong safe haven flight to the USD on fears over a possible Greek exit, concerns over Spanish debt/banking sector, and increasing worries over a slowdown in China.... A turnaround in Asian currencies hinges on decisive policy action from Europe and China, and on favourable outcomes in the June 17 Greek elections. US Federal Reserve Chairman Ben Bernanke’s testimony before Congress on Thursday will also be key for the USD’s near term direction, and therefore for the fortunes of Asian currencies. We would expect SGD and KRW to lead any rally in Asian currencies should we see strong coordinated policy action." Khoon Goh, Senior FX Strategist at ANZ.
"The selloff in Asian currencies since early May has been relentless. Key resistance levels have been broken (USD/TWD and USD/MYR) or threatened (USD/SGD, USD/THB), and new lows against the USD was reached for INR. Our ANZ AXJ Index fell 3.2% over May, and is now down 1.0% year-to-date. The reasons for the poor Asian currency performance can be pinned down to a strong safe haven flight to the USD on fears over a possible Greek exit, concerns over Spanish debt/banking sector, and increasing worries over a slowdown in China.... A turnaround in Asian currencies hinges on decisive policy action from Europe and China, and on favourable outcomes in the June 17 Greek elections. US Federal Reserve Chairman Ben Bernanke’s testimony before Congress on Thursday will also be key for the USD’s near term direction, and therefore for the fortunes of Asian currencies. We would expect SGD and KRW to lead any rally in Asian currencies should we see strong coordinated policy action." Khoon Goh, Senior FX Strategist at ANZ.
