Top Emerging Asia Currency Forecaster Warns of Too Much Optimism
- Westpac is most bearish on Indian rupee and Indonesian rupiah
- Yuan likely to outperform region as bonds attract inflows
An employee counts Indonesian 100,000 rupiah banknotes as a bundle of U.S. one-hundred dollar banknotes sits on a counter at a currency exchange store in Jakarta, Indonesia, on Saturday, Aug. 11, 2018.
Photographer: Dimas Ardian/BloombergCurrencies in emerging Asian markets are rallying, and the most-accurate forecaster is warning there’s too much optimism.
Investors are “too dovish” on the Federal Reserve’s rate path, which helped drive a measure of the region’s currencies to a six-month high even as exports are struggling, according to Frances Cheung, the head of Asia macro strategy at Westpac Banking Corp. Trade talks between the U.S. and China could still fail, while countries such as India and Indonesia, with current-account deficits, are also facing election risks this year.