By Sameer Manekar

(Reuters). Despite bearish expectations for most Asian currencies easing, regional central banks attempted to normalise their policy in response to rising inflation. Meanwhile, investors became bullish about the Singapore dollar, a Reuters poll revealed on Thursday.

Even though COVID-19 locksdowns increased vulnerability, divergence of global and national monetary policies cycles, shrinking yield differentials, headwinds from Russia/Ukraine conflict, long positions in Chinese yuan remained firm,

Maybank analysts say strong fundamentals — a solid trade surplus, potential for more monetary accommodation and capacity to boost infrastructure investment to support growth has investors still betting long on the yuan.

Reuters has polled traders to find that they are consistently positive on the yuan, whereas some analysts see the currency’s decline of 0.8% in March as a sign it will continue its upward trend.

Either way, the bets on the Singapore dollars turned positive for the first times since February. However, the poll found that bearish positions in the Indian rupee, Philippine peso, and Thai baht were only marginally improving, according to a 14-response survey.

“In Emerging Asia the tide of rising inflationary pressures and improving economic conditions continues to tip more central banks toward monetary policy normalization,” Barclays Analysts at Malaysian Central Bank (LON:) expect to see the bank raise interest rates in Malaysia soon.

Since mid-March, the Philippine peso has appreciated almost 2%. The central bank was ready to pre-emptively take action against rising inflation.

Short-term bets on India’s rupee have been at their lowest levels since February 24, A separate poll from Reuters revealed that the Reserve Bank of India (RBI), on Friday, is likely to keep its key interest rates. However, inflation held at the upper end of the expected range.

While the Indian central banking is expected to hold rates up until August at the earliest, this puts it behind the Bank of England and the U.S. Federal Reserve in trying to tackle inflation.

Singapore’s central bank will likely tighten its policy settings next week for inflationary pressures.

In other markets, the Indonesian Rupeiah was marginally longer than usual in February. The short position on Malaysian Ringgit reached its highest point since mid-December due to weak growth prospects.

This poll focuses on the market position of nine Asian emerging currency currencies. It includes the South Korean won (Chinese yuan), South Korean won (South Korean won), Singapore dollar, Indonesian rupee, Taiwan dollar and Indian rupee.

This poll measures net short and long positions using a scale from 3 to 3. Plus 3 is a sign that the market has significant length in U.S. dollar.

These figures also include the positions that were held by non-deliverable forwards.

Below are the survey results (positions expressed in U.S. dollars compared to each currency).

DATE

07-Apr-22 -0.41 0.99 -0.46 -0.05 0.81 0.63 0.32 0.53 0.31

24-Mar-22 -0.16 0.98 0.19 0.04 1.16 0.99 0.12 1.4 0.46

09-Mar-22 -0.85 1.22 0.8 0.49 0.97 1.1 0.05 0.89 -0.08

24-Feb-22 -0.99 0.39 -0.77 -0.01 0.33 0.07 0.2 0.19 -1.07

10-Feb-22 -0.99 0.85 -0.98 0.46 -0.18 0.32 0.1 0.74 -0.31

27-Jan-22 -1.29 0.89 -0.67 0.12 -0.17 0.18 0.25 0.82 0

13-Jan-22 -0.73 0.97 0.22 0.2 -0.15 -0.29 0.28 0.71 0.61

16-Dec-21 -1.07 0.53 0.67 0.54 0.09 1.07 0.84 0.2 0.36

02-Dec-21 -0.88 1.06 0.58 0.15 0 0.47 0.28 0.26 0.71

18-Nov-21 -0.87 0.48 0.07 -0.72 -0.15 0.08 -0.04 0.24 0.12