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Trump shock weighs on Asia FX sentiment; yuan bearish bets still near 10-month high: Reuters poll

By Jongwoo Cheon

By Jongwoo Cheon

SINGAPORE (Reuters) - Sentiment toward most emerging Asian currencies remained bearish in the last two weeks and is unlikely to recover soon as Donald Trump's victory in the U.S. presidential election adds to concerns about the region's exports and ties with Washington, a Reuters poll showed.

While the dollar initially weakened on signs that Trump was sweeping to power, it later rebounded on the back of higher U.S. Treasury yields, souring appetite for the regional currencies, according to the survey of 17 fund managers, analysts and currency traders conducted between Tuesday and Thursday.

Most of the participants provided their estimates after Trump started moving ahead of Democratic rival Hillary Clinton in key battleground states, including Florida and Ohio.


The Chinese yuan <CNY=CFXS> likely saw smaller bearish bets, but pessimistic positions were not much different from a near 10-month high posted two weeks ago.

The yuan hit fresh six-year lows on Thursday as the central bank set its daily guidance rate <CNY=PBOC> weaker for a fifth straight session. [CNY/]

China's exports and imports in October fell more than expected, casting doubts over sustainability of a pick-up in the world's second-largest economy.


The South Korean won <KRW=KFTC> suffered the largest bearish bets in 5-1/2 months on capital outflows and a deepening political crisis surrounding President Park Geun-hye.

Last month, the country reported 3.6 trillion won ($3.1 billion) worth of bond outflows, the largest since February, as a large chunk of the securities came to maturity, a financial regulator data showed.

Foreign investors also sold a combined net 906.6 billion won worth of equities over the previous six consecutive sessions in Seoul's main bourse <.KS11>, according to the Korea Exchange.

Park's presidency has been rocked by allegations that a friend of hers used her ties to meddle in state affairs and wield improper influence.

The Malaysian ringgit <MYR=MY> posted the largest short positions since late May. The ringgit fell to its weakest in more than nine months as the government bond prices <0#MYBMK=> lost ground.

Bearish bets on the Philippine peso <PHP=PDSP> grew again to the largest since mid-October as foreign investors sold Manila stocks <.PSI>. The peso on Wednesday hit a seven-year low.

Sentiment on the Indonesian rupiah <IDR=ID> turned bearish first time since late May, as foreign investors trimmed some of bond holdings.

By contrast, bullish bets on the Indian rupee <INR=D2> slightly rose as the country's move to withdraw larger banknotes from circulation was seen as a positive for the economy, improving transparency and leading to easing inflation.

The 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 <SGD=D3>, Indonesian rupiah, Taiwan dollar <TWD=TP>, Indian rupee, Philippine peso, Malaysian ringgit and the Thai baht <THB=TH>.

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 U.S. dollars.

The figures include positions held through non-deliverable forwards (NDFs).

The survey findings <ASIAPOSN> are provided below (positions in U.S. dollar versus each currency):


10-Nov 1.19 0.86 1.13 0.16 0.26 -0.22 0.88 1.14 0.36

27-Oct 1.23 0.60 1.17 -0.36 0.32 -0.20 0.58 0.91 0.44

13-Oct 0.73 0.51 0.80 -0.38 0.29 -0.19 0.73 1.20 0.96

29-Sept 0.41 -0.24 0.50 -0.75 -0.11 -0.41 0.51 0.87 -0.32

15-Sept 0.70 0.00 0.19 -0.31 -0.10 -0.40 0.37 0.30 -0.04

1-Sept 0.60 -0.16 0.13 -0.11 -0.23 -0.21 0.19 -0.04 -0.27

18-Aug -0.04 -1.08 -0.47 -0.81 -0.90 -0.60 -0.33 -0.49 -0.69

4-Aug 0.12 -1.01 -0.52 -0.84 -0.67 -0.56 0.16 -0.04 -0.56

21-July 1.01 -0.50 0.06 -0.63 -0.37 0.11 0.04 0.10 -0.20

7-July 1.12 -0.11 -0.38 -0.69 0.09 0.24 0.06 0.18 -0.10

23-Jun 0.51 -0.12 -0.47 -0.44 -0.03 0.32 0.11 -0.02 -0.04

9-Jun 0.49 0.14 -0.03 -0.20 0.08 -0.05 0.30 -0.16 0.12

(Reporting by Jongwoo Cheon; Additional reporting by Shaloo Shrivastava and Khushboo Mittal in BENGALURU; Editing by Kim Coghill)