Asian Currencies Strengthen on U.S., China Stimulus Speculation

Asian currencies advanced on speculation policy makers from the U.S. to China will increase economic stimulus measures to support growth, spurring demand for the region’s exports and financial assets.

Malaysia’s ringgit reached a two-week high and South Korea’s won rose for a fifth day, its longest rally in a month, after data showed U.S. housing starts gained 6.9 percent in June to the highest level since 2008. The Federal Reserve is prepared to “take further action as appropriate” and has the capacity to make more bond purchases, Chairman Ben S. Bernanke said in his Congress testimony yesterday. Asian economies may need to ease further as Europe’s debt crisis damps growth, the Asian Development Bank said today.