Asian currencies headed for their best week in two months, led by Malaysia’s ringgit and Thailand’s baht, as improvements in U.S. economic data eased concern that global growth is slowing.
The Bloomberg JPMorgan-Asia Dollar Index (ADXY) halted a three-week slide to advance 0.3 percent after reports showed U.S. jobless claims fell more than economists estimated and the nation’s services industry expanded. Emerging-market currencies had their worst start to a year since 2008 following a rout in Turkey’s lira and a devaluation in Argentina’s peso as the Federal Reserve pressed ahead with a plan to slow the pace of its monthly bond purchases by $10 billion.
“The selloff is clearly overdone, and there’s a need to distinguish the good and bad ones within the EM bloc,” said Roy Teo, a Singapore-based currency strategist at ABN Amro Bank NV. “The recovery remains fragile given the headwinds from Fed tapering concerns.”
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