Investors should bet the world’s “two very weak currencies,” the dollar and euro, will appreciate against emerging-market counterparts as Asian economies begin to slow, according to Patrick Legland, global head of research for Societe Generale (GLE) SA. “We may have a new direction for currencies and the euro and dollar against emerging-market currencies,” Legland said in an interview at Bloomberg News’ headquarters in New York. “It’s something we want our clients to heed because we think there is money to make.” Currencies that may see heightened weakness against the greenback and 17-nation euro include the Indian rupee and Thai bhat. SocGen advised clients to play the trade in baskets of emerging-market currencies such as Asia, excluding Japan, according to Legland. During the first half of the year “we saw most emerging markets having to cope with inflation and they either raised interest rates or limited currency appreciation,” he said. “We’re starting to see some emerging markets talk about cutting interest rates and it’s obviously a very powerful signal.” The dollar has gained against 13 of 18 emerging market counterparts during August after weakening against the majority in the first seven months of the year, according to Bloomberg data. To contact the reporter on this story: Allison Bennett in New York at abennett23@bloomberg.net To contact the editor responsible for this story: Dave Liedtka at dliedtka@bloomberg.net

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