Rupiah rides surge in Asean cross-border trade using local currencies

[SINGAPORE] The rupiah, ringgit and baht are gradually gaining ground as choice currencies in cross-border trade deals across South-east Asia by companies big and small, as the centre of gravity for global financial activity shifts to the east and companies diversify from excessive greenback exposure.

For the past six decades, South-east Asia caught a cold whenever the US dollar sneezed. But the almighty greenback is facing a crisis of faith from global investors and remains weighed down by bearish sentiment after notching its worst first-half performance at a pace unseen since the Vietnam War.

Though the world’s reserve currency still remains king, its peers are raising the stakes – most notably with China’s renminbi sizing up to be a barometer for regional currency swings and as a choice currency for exporters to settle trades in.