The Taiwan dollar and Philippine peso led gains in Asian currencies this week

The Taiwan dollar and Philippine peso led gains in Asian currencies this week as China's exports exceeded economists' estimates, augurs well for regional economic recovery and trade.

The yuan has completed its best week in a month after China's trade surplus increased to $ 22.9 billion in November as exports and imports rose to records. Malaysia's ringgit rose for the second consecutive week, its longest winning streak in two months, after reports showed overseas shipments and manufacturing grew faster than analysts had forecast.

"China's export Surprise mean strong demand for products made elsewhere in Asia," said Julie Yu, a currency trader based in Taipei in Taiwan Shin Kong Commercial Bank. "Economic growth in the region will continue to support gains in Asian currencies."

The peso rose 0.5 percent to 43.675 per dollar this week, according to data compiled by us. Taiwan dollar appreciated 0.5 percent to NT $ 30,585, the ringgit rose 0.2 percent and 3.1345 yuan gained 0.12 percent to 6.6556.

Global funds bought a total stocks of 1.3 billion U.S. dollars more than they sold in Indonesia, South Korea, Taiwan and Thailand this week, the serial data exchange. The International Monetary Fund predicts that Asia's developing economies will expand 9.4 percent in 2010, while the advanced economies will grow by 2.7 percent.

"Durable recovery"

The ringgit traded near a two weeks after the government reported December 9 that factory production rose 3 percent in October from a year earlier, beating the average estimate of 2.1 percent in polled by us. Exports grew by 1.3 percent this month compared with the predictions of a decline of 1.4 percent, a report showed on 3 December. The currency has appreciated by 9.3 percent this year, went to its best annual performance since 1973.

"Economic data have been flexible, and recovery in this region is seen as durable," said D. Sivadass, a currency trader at EON Capital forward Bhd in Kuala Lumpur. "The overall picture is still on the market for the ringgit to appreciate next year."

The yuan rose for a second week on speculation central bank of China will raise interest rates to moderate inflation. Consumer prices accelerated to its fastest pace in 28 months in November, up more than expected 5.1 percent over the previous year, a statistical report showed today in Beijing. the producer price inflation was 6.1 percent, up from one of 28 economists surveyed by us had expected.

President Hu Jintao and Premier Wen Jiabao will meet for a three-day Central Economic Work Conference to discuss monetary policy in 2011.

Inflation Forecast

"The Central Economic Work Conference is likely to approve general tightening of monetary conditions," said Frances Cheung, a Hong Kong senior strategist at Credit Agricole CIB. It is estimated that the central bank increased the benchmark interest rate by 1 percentage point in mid-2011.

Taiwan dollar advanced for a second week after the government reported December 7 that exports rose more than forecast to 21.8 percent in November from a year earlier. Consumer prices rose 1.53 percent, the fastest pace in nine months, data showed yesterday.

"The strong growth in Taiwan will continue to attract foreign funds," said Yu Shin Kong, Taiwan. "The central bank will continue to slow progress on the coin, but I still think it's very likely that the currency will reach NT $ 30 soon."

Elsewhere, South Korea's won fell 0.4 percent in the week to 1,143.60 per dollar and the Indonesian rupiah fell 0.1 percent to 9,018. India's rupee was little changed at 45.11 and the Thai baht was trading at 30.08 from 30.05 the previous week.