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Franklin Templeton Eyes Asian Assets

Franklin Templeton Investments is planning to shift investments into Asian government bonds to take advantage of an expected weakening in the dollar versus its Asian counterparts.

Franklin Templeton Investments is planning to shift investments into Asian government bonds to take advantage of an expected weakening in the dollar versus its Asian counterparts. Michael Hasenstab, fund manager of the $643 million Templeton Global Bond Fund in San Mateo, Calif., says it will continue to take profits on euro-denominated positions and seeks to shift the proceeds into Asian assets. He will also look to pick up assets in non-euro Scandinavian markets. Hasenstab emphasizes the current strategy of the bond fund is to position it for the continued and gradual appreciation of Asian currencies versus the dollar.

Alex Calvo, head of the fund in San Mateo, says that while it would not be easy to quantify the amount, the fund will continue to exit from both the U.S. and European markets to invest in Asia. Calvo explained that these increases in investment in Asian currencies are a part of a strategy to diversify. He declined to provide more information on what securities the fund might buy or sell, except to note that its exposure to euro-denominated assets was down to 33% at the end of last month, from 41% the previous month. At the same time, the allocation to Asia has increased to 34%, from 13%. He declined to provide a forecast for how much more the fund will shift to Asian investments.

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