Won and rupiah attractive bets, say strategists

The US dollar is forecast to weaken against Asian currencies and investors could find attractive entry levels for the Korean won and Indonesian rupiah in coming weeks, suggest observers.

  • 31 Jul 2009
Email a colleague
Request a PDF

The Korean won and Indonesian rupiah are the most attractive currency bets in Asia against a weakening US dollar, say strategists.

“We think there’s going to be a weaker US dollar against Asian currencies and if there’s a break higher in the major currencies against the US dollar, which we think will happen, it will trigger more dollar weakness against emerging markets and Asian currencies,” says David Mann, senior foreign exchange strategist at Standard Chartered in Hong Kong.

“If there is any rebound in the US dollar, we think it’s going to be quite shallow because we think a lot of people are still looking to put longer-term positions on.”

The Korean won is a strategist favourite because it has recovered from craterous lows and is set to strengthen further. “The end of the week was very bullish for the Korean won, which closed below W1,230 [to the US dollar], which we haven’t seen since September 2008,” says Mann.

The currency notably suffered against the US dollar during the credit crisis and was among the weakest Asian currencies, but it has been supported by a number of positive factors in recent months.

The Korean economy has held up better than many of its peers, and it grew at 2.3% during the second quarter from the last three months, the fastest pace in more than five years. It is also no longer pressured by the lack of US dollars in its economy, as the sovereign, banks and corporates have managed to sell debt internationally. South Korean issuance has made up about 50% of total debt sales in Asia ex-Japan this year.

Investors might find an attractive entry level in the coming weeks. “Short-term wise, the moving average is clustered around W1,260 and that’s probably the best opportunity for investors to get into the won,” suggests Mann.

The Indonesian rupiah is also likely to rise strongly against the US dollar in the months ahead because it is less sensitive to global growth, but at the same time will benefit from improving sentiment. The currency traded at Rp9,930 against the US dollar on July 31.

“Indonesia’s consumption sector is much stronger and its exports aren’t really reliant on the US,” says Kelvin Lau, a research analyst at Taifook Securities in Hong Kong

Mann adds: “If the rupiah can test 10,000 against the US dollar again, it would be a good level. That was a good psychological support which is now a good psychological resistance.”

  • 31 Jul 2009

Bookrunners of International Emerging Market DCM

Rank Lead Manager Amount $m No of issues Share %
  • Last updated
  • Today
1 Citi 48,617.52 231 9.46%
2 HSBC 43,297.67 292 8.43%
3 JPMorgan 34,507.54 171 6.72%
4 Standard Chartered Bank 28,928.33 204 5.63%
5 Deutsche Bank 25,097.86 98 4.88%

Bookrunners of LatAm Emerging Market DCM

Rank Lead Manager Amount $m No of issues Share %
  • Last updated
  • Today
1 Citi 13,465.23 42 17.91%
2 HSBC 8,624.00 21 11.47%
3 JPMorgan 7,888.60 35 10.49%
4 Deutsche Bank 6,487.13 9 8.63%
5 Bank of America Merrill Lynch 4,573.34 21 6.08%

Bookrunners of CEEMEA International Bonds

Rank Lead Manager Amount $m No of issues Share %
  • Last updated
  • Today
1 Citi 19,041.78 65 11.42%
2 Standard Chartered Bank 15,207.37 64 9.12%
3 JPMorgan 15,111.39 63 9.06%
4 Deutsche Bank 12,722.14 33 7.63%
5 HSBC 12,613.66 56 7.56%

EMEA M&A Revenue

Rank Lead Manager Amount $m No of issues Share %
  • Last updated
  • 02 May 2016
1 JPMorgan 195.08 50 10.55%
2 Goldman Sachs 162.26 37 8.77%
3 Morgan Stanley 141.22 46 7.64%
4 Bank of America Merrill Lynch 114.20 33 6.18%
5 Citi 95.36 35 5.16%

Bookrunners of Central and Eastern Europe: Loans

Rank Lead Manager Amount $m No of issues Share %
  • Last updated
  • Today
1 UniCredit 4,631.80 28 12.96%
2 ING 3,270.62 26 9.15%
3 Credit Agricole CIB 2,397.03 10 6.71%
4 SG Corporate & Investment Banking 2,093.15 15 5.86%
5 MUFG 1,979.59 10 5.54%

Bookrunners of India DCM

Rank Lead Manager Amount $m No of issues Share %
  • Last updated
  • Today
1 AXIS Bank 6,262.97 112 23.11%
2 HDFC Bank 3,031.20 67 11.18%
3 Trust Investment Advisors 2,793.32 96 10.31%
4 AK Capital Services Ltd 1,915.50 83 7.07%
5 ICICI Bank 1,863.14 64 6.87%