Emerging Currencies Climb With Kiwi; Copper Futures Drop

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gsr-copper-2541Emerging-market currencies from South Korea to Malaysia rallied with their commodity-linked peers while Asian stocks rose after yesterday’s selloff. Copper resumed its drop before Chinese factory and retail data amid concern the slowdown in Asia’s largest economy is worsening.

The Korean won gained 0.3 percent to 1,067.82 per dollar by 9:23 a.m. in Seoul, rising from a one-week low, while Malaysia’s ringgit and the Thai baht added at least 0.2 percent. New Zealand’s dollar rose to a trade-weighted record after the central bank boosted interest rates from a record low. The MSCI Asia Pacific Index added 0.2 percent as Australian shares rebounded. Copper futures lost 0.3 percent, falling for the fourth time in five days. Gold held near a six-month high.

China is projected to report slower growth in industrial output today and an increase in retail sales, according to economists polled by Bloomberg. Global stocks have fallen the past four days in the longest slump this year after an unexpected decline in Chinese exports and the first onshore bond default fueled pessimism over the outlook for the world’s second-largest economy. South Korea and Malaysia also review rates today, while the U.S. and Australia issue jobs data.

“Focus now shifts to China’s industrial production later today,” Stan Shamu, a markets strategist at IG Ltd. inMelbourne, wrote in an e-mail to clients. “Any disappointment in this reading will only compound China fears and could be detrimental to risk heading into the end of the week.”

The ringgit climbed 0.3 percent to 3.2811 per dollar after retreating 0.3 percent yesterday, while the baht added 0.2 percent to 32.40 versus the greenback, trimming this week’s 0.3 percent decline.

Kiwi Rates

The kiwi touched its highest intraday price versus the greenback since Oct. 22 after the Reserve Bank’s 25-basis-point rate increase made New Zealand the first developed nation to exit record-low borrowing costs this year.

The central bank’s trade-weighted index for the currency climbed to as high as 79.86, the strongest-ever level in data dating back to 1985, when the New Zealand dollar was floated. Governor Graeme Wheeler said the cash rate may be increased by a total 125 basis points, or 1.25 percentage point, in 2014.

Australia’s dollar added 0.3 percent in a second day of gains, rising to 90.12 U.S. cents.

One-month non-deliverable forwards on India’s rupee gained 0.3 percent to 61.36 per dollar in early trading after the currency weakened 0.4 percent to 61.22 yesterday.

India reported a surprise 0.1 percent increase in industrial production for January, while the consumer-price index fell to 8.1 percent in February from 8.79 percent. The median of economists’ estimates compiled by Bloomberg was for prices to rise by 8.3 percent. India releases data tomorrow on wholesale prices, regarded as a key inflation indicator.

Nikkei Rebounds

Australia’s S&P/ASX 200 Index (AS51) rose 0.4 percent today, paring yesterday’s 0.6 percent drop. The Nikkei 225 Stock Average in Tokyo gained 0.2 percent following yesterday’s 2.6 percent slump, the most this month. The Kospi Index in Seoul was little changed.

Copper futures rose 0.3 percent in the previous session after sliding March 11 to the lowest intraday level since July 2010. Data released at the weekend showed China’s overseas shipments slid the most since 2009 in February and producer prices sank the most since July. With China the world’s biggest consumer of industrial metals, the S&P GSCI index of raw materials is down 1.9 percent this week, set for its steepest slump since the start of the year.

Gold, Oil

In a sign the Chinese government may be backing off its practice of bailing out companies with bad debt,Shanghai Chaori Solar Energy Science & Technology Co. failed to pay full interest on its bonds last week. Baoding Tianwei Baobian Electric Co.’s shares tumbled in Shanghai yesterday as trading on its bonds remained suspended. The electrical-equipment maker said March 10 it expects to post a second year of losses.

Gold was little changed at $1,365.25 an ounce in the spot market after climbing to the highest price on a closing basis since Sept. 9 yesterday.

West Texas Intermediate oil rose 0.1 percent to $98.09 a barrel. WTI slid 2 percent yesterday and touched the lowest intraday level since Feb. 7 after an Energy Information Administration report showed U.S. oil inventories rose three times as much as analysts projected and refineries operated at the lowest rate in four months.

Yields on 10-year U.S. Treasuries were little changed at 2.74 percent after falling four basis points in New York in a third day of declining rates.