Asian Currencies Tumbles Led by New Zealand dollar and Indonesian Rupiah, Philippine Peso Falls to 45

September 29 has been another fascinating trading day for Asian financial markets as most ASIAN ASEAN currencies have been battered 

As of 5 pm, the biggest losers among Asian currencies has been the New Zealand dollar which got hammered by over 1% as well as the Indonesian rupiah which dived by 1%. Most of the Asian currencies has been down by over .5%. Incredible sight

This hasn't been a one day event, though yesterday punctuated on the firming US dollar-falling Asian currencies dynamic which in tradition highlighted a risk OFF environment.

 The New Zealand dollar (USDNZD) has spiked beyond the early 2014 highs 

The USD-Aussie dollar has nearly reached January 2014 highs

The ongoing pressures on Asian currencies has also affected the Singapore dollar (USDSGD)

The Taiwan dollar (USDTWN)

The South Korean won (USDKRW)

The Malaysian ringgit (USDMYR)

Meanwhile, the Indonesian rupiah (USDIDR) is once again approaching the January 2014 "turbulent" highs.

The Philippine peso officially closed at 44.995 on September 29. I have already elaborated on the plight of the peso.

The last time Asian currencies tumbled (late 2013 to early 2014), Asian stocks came under selling pressure as seen by the MSCI iShares All country Asia Index (AAXJ).

The same dynamic appears to be re-emerging. Some of the biggest contributors to the recent regional stock market decline has been Australia’s S&P/ASX, the Taiwan Stock Exchange, the Malaysian KLCI and the Hong Kong’s Hang Seng (I know this has been partly due to riots). 

Meanwhile the Asian contagion appears to be spreading to other bourses as seen in the Singapore Strait Times, the Vietnam Ho Chi Minh index and the South Korean KOSPI.

The above dynamic highlights on going changes at the margins.

Yet will the region’s high flyers, India’s Sensex, Indonesia’s JCI, the Philippine Phisix, Thailand’s SET and the New Zealand 50 be immune to a seeming transition towards a risk OFF environment?

Don’t forget that the two of the current regional stars has been labeled as part of the ‘fragile five’ last year or as per Morgan Stanley “troubled emerging market currencies under the most pressure against the U.S. dollar” due to “high inflation, weakening growth, large external deficits, and in some cases exposure to the China slowdown, and high dependence on fixed income inflows”

Very interesting developments indeed.