Encouraging Currency Bounces

September 2008 | Market Strategy

Asian currencies are seeing some encouraging bounces, amid a pronounced rebound in equities and a renewed weakening of the US dollar. In the short term, we could see further upside, albeit with considerable volatility. However, the medium-term outlook is being clouded by uncertainty as to how the crisis pervading the US financial system will play out. In short, it is too soon to become positive towards Asian currencies - although they would receive a significant boost if the US dollar plummeted further.

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