How long will the rebound in Asian currencies last?

Most Asian currencies have risen strongly so far this year amid a recovery in global risk appetite. However, the rebound is unlikely to last long. We are of the opinion that the euro-zone will slip into recession this year, which is likely to lead to a limited break-up of the currency union. The resulting shock to global investor confidence is likely to lead to a renewed fall in investor risk appetite, putting downward pressure on currencies.