Home / Financial Services/ Indian rupee bulls dig in as investors grapple with elections across Asia: Reuters poll

Indian rupee bulls dig in as investors grapple with elections across Asia: Reuters poll

Comments / {{hitsCtrl.values.hits}} Views / Friday, 12 April 2019 00:00


A customer hands a 50-Indian rupee note to an attendant at a fuel station in Ahmedabad, India - REUTERS 

Reuters: A tale of two elections saw investors raise their bullish bets on the Indian rupee over the past two weeks while long positions on the Thai baht unravelled to their lowest this year, a Reuters poll showed.

Foreign investors have ploughed billions of dollars into India ahead of an election process spread over seven phases and ending only toward the end of next month with nearly 900 million people eligible to vote. The process begins on Thursday.

Investors, who only turned bullish on the rupee at the start of March for the first time in nearly a year, have since raised their long positions to their highest since January of last year, the poll of 14 respondents showed.

The prospect that Prime Minister Narendra Modi and his party will manage to just about win a parliamentary majority has sparked net inflows of over $8 billion into equities so far this year as of April 9. More than half of the inflows occurred in March alone.

On the other hand, Thailand, which is still reeling from the fallout of uncertainty surrounding its election at the end of March, has seen investors unwind some of their long positions on the baht gradually built up during the first two months of the year.

The baht, however, still remains the best performing currency so far this year among its regional peers, gaining about 2.5% thus far.

Final results of the Thai election will be announced on May 9.

“Two-directional risk remains high and both currencies could still move either way depending on how the election news develops over the next few weeks,” said Julian Wee, a South Asia investment strategist at Credit Suisse.

Indonesia, Southeast Asia’s largest economy, also heads into elections next week with investors turning bullish on the rupiah once again after a month’s hiatus.

Elsewhere, investors trimmed long positions on China’s yuan to their lowest since turning bullish in January.

There has been progress toward a trade deal between China and the United States but US officials say there are still important issues for the countries to address. However, the fallout from the months-long trade war has resulted in weak economic data, posing concerns for the health of the global economy.

In response, China has undertaken massive stimulus measures to reinvigorate its economy, which analysts at HSBC say will boost growth as it filters through in the coming quarters.

The Asian currency positioning poll is focused on what analysts and fund managers 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 include positions held through non-deliverable forwards (NDFs).

Share This Article

Facebook Twitter


1. All comments will be moderated by the Daily FT Web Editor.

2. Comments that are abusive, obscene, incendiary, defamatory or irrelevant will not be published.

3. We may remove hyperlinks within comments.

4. Kindly use a genuine email ID and provide your name.

5. Spamming the comments section under different user names may result in being blacklisted.


Today's Columnists

Will power cuts solve electricity crisis?

Tuesday, 23 April 2019

The country faced electricity power cuts, reminding citizens of early 1990s, which resulted in private power producers supplying electrical power with long-term power supply agreements. Today, most have completed their agreement period, but some were

Easter attack: Going beyond condemnation

Tuesday, 23 April 2019

Yesterday was Easter Sunday; 227 persons [at the time of writing] have been killed, and many times more injured. The primary targets were churches and international hotels. It seems clear that the extremist group ISIS (Islamic State of Iraq and Syria

Easter Sunday nightmare

Tuesday, 23 April 2019

This is the most important day of the year for Christians – the Peaceful Easter Sunday or Easter Day was shattered by deadly explosions in several Christian churches throughout the country; and we excoriate such hatred in our beloved country. We th

Poignant pondering on a patriarch

Monday, 22 April 2019

Almost five months have gone. It is with a profound sense of sadness that we experienced the demise of our veteran teacher, respected author, legal luminary, an accomplished ambassador, an eminent public servant and an amazing human being, Dr. Wickre

Columnists More