Investors turn long on rupee after 4 months; rupiah short bets cut

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NEW DELHI: Investors switched to long positions on rupee for the first time since September, on hopes that the economy may be able to withstand the worst of the Omicron surge and bets that US rate hikes are largely priced in, a Reuters poll found.
Broadly, investors stayed bearish on most Asian emerging currencies, the poll of 12 respondents showed, as the spread of Omicron threatens to slow the region’s recovery, although, so far, emerging equities have remained fairly resilient.
High inflation in the United States may also prompt the Federal Reserve to hasten its interest rate hikes, with the central bank signalling in December that they could raise rates three times this year.
“Although these are headwinds, we do not think the market is overly complacent as risks are likely to be moderate (Omicron) and/or have been largely priced already (Federal Reserve),” analysts at Barclays…

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