Asian currency risk implodes
The Fed’s gradualist approach to raising rates is good news for Asian stocks
The cost of hedging Asian currencies against the US dollar continues to fall in a nearly straight line as China’s external account stabilizes and Asian economies expand.
With the US locked into slow growth and lowflation, and the Federal Reserve likely to remain gradualist in raising interest rates, there’s hardly a ripple in Asian foreign exchange markets. That’s good news for Asian equities on China’s periphery.