Asian currencies advanced this week, led by South Korea’s won and the Philippine peso, on optimism faster growth in emerging markets will spur global investors to add to holdings of regional assets. Overseas investors pumped a combined $1.4 billion into equities in Indonesia, the Philippines and Taiwan this week, according to exchange data. Asia’s developing economies will expand 8.4 percent this year and next, more than triple the 2.5 percent annual growth of industrialized nations, the International Monetary Fund estimated on Jan. 25. “Asian currencies have strong links to fund inflows into their stocks,” said Minoru Shioiri, chief manager of Mitsubishi UFJ Morgan Stanley Securities Co. in Tokyo. “The global stock markets have been pretty solid recently, supporting sentiment for investors’ risk appetite, which is good for Asian currencies.” The won advanced 0.9 percent this week to 1,113.83 per dollar, according to data compiled by Bloomberg. The Philippine peso rose 0.9 percent to 44.103 and Singapore’s dollar gained 0.3 percent to S$1.2813. The won rose to a one-week high yesterday after the Bank of Korea said on Jan. 27 the nation’s current-account surplus widened to $2.11 billion in December from a revised $1.93 billion the previous month. The currency completed its biggest weekly gain since December after the Federal Reserve said on Jan. 26 it will keep buying $600 billion of Treasuries through June, spurring speculation more money will be channeled into faster- growing Asian economies. Growth Forecast “There’s a general sense that exports are gaining momentum,” said David Cohen, head of Asian forecasting at Action Economics in Singapore. “The Fed still talks that interest rates aren’t about to raised. That would be supportive of the won and other Asian currencies.” The peso rose, snapping three weekly declines. The Philippine economy probably expanded 6 percent in the fourth quarter from a year earlier after having grown 6.5 percent in the previous three months, according to a Bloomberg survey before government data due on Jan. 31. Gross domestic product rose 7 percent in 2010, which would be the fastest pace since 2007, according to the poll. The Philippines may allow some gains in the peso should capital inflows become excessive, central bank Deputy Governor Diwa Guinigundo said yesterday. Elsewhere, Indonesia’s rupiah gained 0.3 percent to 9,033 per dollar, Malaysia’s ringgit rose 0.2 percent to 3.0550 and China’s yuan was little changed at 6.5861. Thailand’s baht fell 1.3 percent to 31.09 and India’s rupee dropped 0.3 percent to 45.7562. To contact the reporters on this story: Yumi Teso in Bangkok at yteso1@bloomberg.net To contact the editor responsible for this story: Sandy Hendry at shendry@bloomberg.net

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