Halister News

(Bloomberg) -- Aberdeen Asset Management will resume buying Asia’s currencies when valuations are cheaper, Leong Lin Jing, investment manager at the fund which overseess $4b in Asian fixed income assets, says in interview.

• Aberdeen remains dollar bull for May and June
• Market was not adequately pricing in Fed rate hikes
• Sees first U.S. rate rise in Sept.
  • “We have a confluence of global risk events going into June like Brexit, OPEC meeting and elections,” says Leong
• High-beta currencies IDR, MYR and KRW are most susceptible to an emerging market selloff
  • Korea’s national pension fund is raising overseas investment which will make KRW more volatile
  • Bearish on MYR on govt’s off-balance debt
    • IDR and Indonesian bonds currently expensive; will “look at them” in sell-off
• PBOC may allow yuan to appreciate slightly against CFETS basket as it was depreciating the currency vs basket earlier when Asian currencies were appreciating
• Aberdeen is most overweight in India among Asian govt bond positions
  • Duration has been shortened to 5-7 year from 15-year plus segment
  • “We have cut duration as we do not see immediate visibility for (an RBI) rate cut soon and have pretty big supplies coming up in July,” says Leong
• Aberdeen is also overweight on Korean bonds on expectations of further rate easing
• Most underweight on Singapore and Hong Kong bonds because of link to U.S. Treasuries
• Oil prices won’t be an issue from an inflationary perspective until it hits $60/bbl