By Laurence Fletcher
LONDON | Wed Sep 21, 2011-11: 47-BST
LONDON (Reuters) - the Dexia emerging markets debt Fund relies on weakness for South African Rand and the Australian dollar and sees the vulnerability of the product as more resilient Asian currencies given currency to a slowdown in the global economy.
George Farré, who the 100-million euro-long-short emerging market debt Fund, which has risen to the recent appreciation of the RAND, of less than $6.70 last month for $7,40, despite "very, very low" consumer confidence and slowing growth in South Africa.
"The fundamental picture is not good in South Africa, we think it (the currency) is expensive," Farré said on Friday.
"If the things of even worse people are papers." "It is a very bad risk/return long."
The Australian dollar strengthened says of just about $0.80 last summer to almost $1.04 currently and Farré, that it is vulnerable to a sharp worldwide economic downturn looks.
"If we move to slower growth for a long period, demand will be not as high, and these currencies have a correction," he said.
Cutting Farré, market volatility has also asked to use in his Fund of 200 percent on flat and cut positions in appointed, which he sees, how crowded the Malaysian Ringgit and Indonesian rupiah.
"The ringgit is a position that really crowded." If something happens chaotic then it more than others could be affected, ", he said."
ASIA
However, he held long positions in Asian currencies such as the Chinese Yuan, Singapore dollars and Korean won.
While interest rates rise in some Asian countries have finished, they are probably not be cut, since the United States and Europe will act to help to promote global growth, he said.
"I think Asian (currencies are) basically protected from the turmoil." I believe that there will be a collapse of Asian currencies, as we seen in 2008 have ", he said." "It will lower interest rates in the Asian countries not required." Asia has strong growth, the reserves, the balance of payments.
"We think G3 country-Europe, the United States and Japan-much to supply more liquidity relaxation..." "I think you are one way or the other things similar to QE3."
Farré which hit a one-year long the Polish Zloty against the Hungarian forint, low on Friday, and has also bought credit default Swaps--the default number-due to the Hungary ratio debt to GDP of almost 80 percent.
"We think that the situation in Hungary is not very good," he said. "If something goes wrong in Europe, there is a higher probability of failure in Hungary."
"they do everything to obtain the currency." But give to help them become more competitive the currency should copy... "Poland is much stronger than Hungary."
(Editing by Sinead cruise and Patrick Graham)
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