VINACHEM

Thailand’s baht and Malaysia’sringgit led Asian currency gains to the best week since Januaryon speculation Japan’s monetary easing will increase the flow offunds into emerging-market assets.

The baht strengthened beyond 29 per dollar for the firsttime since 1997 and the ringgit appreciated for a fourth week,the longest run in 14 months. South Korea’s won rose this weekafter touching an eight-month low on the risk of a nuclear testor missile launch by North Korea. The Bank of Japan said April 4it plans to buy 7.5 trillion yen ($75 billion) of bonds a monthin the biggest move since its easing started in 2001.

“I expect the Bank of Japan’s plan to double its monetarybase will lead to a pickup in inflows to emerging Asia,” saidKhoon Goh, a Singapore-based senior strategist at Australia & New Zealand Banking Group Ltd. (ANZ) “Some of the outflows werelikely due to concerns over tensions on the Korean peninsula.”

The baht climbed 1.1 percent from a week ago, the mostsince the five-day period ended Jan. 18, to 29.01 per dollar inBangkok, according to data compiled by Bloomberg. It touched28.88 on April 10, the strongest level since a devaluation inJuly 1997 that sparked the Asian financial crisis. The ringgitrose 0.6 percent to 3.04 in Kuala Lumpur this week.

The Bloomberg-JPMorgan Asia Dollar Index, which tracks theregion’s 10 most-active currencies, rose 0.2 percent in the fivedays through yesterday, the biggest gain since January. The MSCIAsia Pacific Index of shares increased 3.3 percent.

Fund Inflows

Global funds bought $810 million more Thai sovereign debtthan they sold since the BOJ’s easing announcement, Thai BondMarket Association data show. This year’s net purchases totaled$10 billion through April 11, compared with $31 billion for thewhole of 2012. Overseas investors have pumped more than $12billion into Indian stocks and fixed-income securities this year,exchange data show.

South Korean President Park Geun Hye offered to resumedialog with the North in an effort to ease tensions, herspokeswoman Lee Mi Yon said by phone yesterday. The timeframefor a North Korean missile launch is until around April 15,South Korean defense ministry spokesman Kim Min Seok said April11. The date marks the birth anniversary of the North’s founderKim Il Sung.

The won was little changed yesterday and gained 0.2 percentthis week to 1,129.40 per dollar in Seoul, according to datacompiled by Bloomberg. It touched 1,144.82 on April 9, theweakest level since July 26.

Yuan Positions

China’s yuan reached the highest level this week since thecountry unified official and market exchange rates at the end of1993. Yuan positions at local financial institutions stemmingfrom foreign-exchange transactions, a gauge of cross-bordercapital flows, climbed 295 billion yuan ($47 billion) inFebruary, the central bank said on April 10.

Gross domestic product probably increased 8.1 percent inthe January-March period, according to the median estimate ofeconomists ahead of data due April 15 in Beijing. That’s morethan the 7.9 percent posted in the previous quarter.

The currency rose for a seventh week, the longest winningstreak since November, climbing 0.2 percent to 6.1922 per dollarin Shanghai, prices from the China Foreign Exchange Trade Systemshow. The currency touched the 1993 high of 6.1900 yesterday.

“Capital inflows have been strong as investors see China’seconomic growth remains resilient,” said Daniel Chan, a HongKong-based executive vice president at Glory Sky Global MarketsLtd. “A stronger exchange rate is also favorable for thegovernment to boost domestic demand as officials are shiftingthe economy away from an export-dependent one.”

Malaysian Vote

Malaysia’s ringgit had a fourth weekly gain on speculationthe ruling coalition will win a May 5 election and continueeconomic reforms. The vote will determine if Prime MinisterNajib Razak’s Barisan Nasional alliance can extend its 55-yearrule. Najib has embarked on a $444 billion spending spree tobuild railways, roads and power plants to achieve developed-nation status by 2020.

“The calling of the election, coupled with more marketconfidence that Najib is likely to win, has been the main driverfor the week,” said Rob Ryan, a Singapore-based currencystrategist at Royal Bank of Scotland Plc.

Elsewhere in Asia, Indonesia’s rupiah rose 0.3 percent froma week earlier to 9,713, India’s rupee gained 0.5 percent to54.5250 and Vietnam’s dong climbed 0.3 percent to 20,855. ThePhilippine peso fell 0.3 percent to 41.265 and Taiwan’s dollarweakened 0.2 percent to NT$29.995.