Long rupee bets return as Asia FX sentiment improves: Reuters poll

By Sumanta Dey

BANGALORE (Reuters) - Bullish bets on the rupee have resurfaced for the first time since early May as investors grow generally more upbeat on most emerging Asian currencies, a Reuters poll showed on Thursday.

For the first time since mid-January, the poll of foreign exchange analysts showed investors were optimistic on 8 out of 9 currencies in the survey. Eleven analysts took part in the latest survey.

Bullish bets on the Chinese yuan hit their highest level since early June, while long positions on the Malaysian ringgit grew to the largest since late May.

However, long positions in the South Korean won, Singapore dollar, Taiwan dollar and Philippine peso were reduced slightly.

The poll also showed that market players were still bearish on the Indonesian rupiah.

Market sentiment toward emerging Asian currencies has generally improved after the U.S. Federal Reserve surprised markets in September by keeping its bond-buying stimulus programme unchanged.

The shock decision created uncertainty over how soon the Fed would start to taper its bond-buying, and such doubts have been reinforced this month as the U.S. government's partial shutdown stirred worries about the potential impact on U.S. growth.

The rupee has rebounded about 11 percent since hitting record lows in late August, though it is still down more than 11 percent so far this year. Data earlier this week showed India's trade deficit narrowed to a two-and-a-half-year low in September, raising hopes for a significant reduction in the country's gaping current account deficit, which heaped pressure on the currency in recent months.

The Reuters survey is focused on what analysts believe are the current market positions in nine Asian emerging market currencies: 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 U.S. dollars. The figures included positions held through non-deliverable forwards (NDFs).

(Editing by Kim Coghill)