Malaysia’s ringgit fell to an eight-week low after signs of a recovery in the U.S. housing market bolstered the case for the Federal Reserve to scale back stimulus that’s spurred gains in emerging-market assets.
China’s foreign-exchange reserves rose last quarter by the most in more than two years, a sign the government’s efforts to protect growth attracted money even as developing nations from India to Indonesia saw capital exit.
Asian currencies will extend their biggest slide in three years through December before rebounding in early 2012 as export demand picks up, said Standard Chartered Plc, the most-accurate forecaster for the region.
The Philippine peso is the only Asian emerging-market currency that forecasters have become more bullish on this year as the nation’s improving economy increases the chance it will win an investment-grade credit rating.
India’s rupee is likely to strengthen as measures to solve a debt crisis in Europe spur demand for assets in the best-performing economies and policy makers favor appreciation to help tame inflation, Standard Chartered Plc said.