Investors cut back short bets on emerging Asian currencies as most local central banks maintained their hold stance on interest rates, but remained in bearish territory for Malaysian ringgit and China’s yuan.

Since all the 10 poll responses were received before the U.S. Federal Reserve’s meeting on Wednesday, they do not take into account its stance that it may need to increase rates by up to half of a percentage point by the end of the year.

Analysts predict further rate hikes could support the dollar for longer, which could weigh on the risk-sensitive Asian assets.

“It is… perplexing as to why the Fed would hold but look to rather aggressively hike again later instead of just doing the moves yesterday,” Maybank analysts wrote in a note.

“Such mixed messaging is likely to support keeping the dollar index range-traded near term at around 103.00 – 104.00 given that it still looks unclear how the Fed rate path would evolve.”

The fortnightly poll showed short bets on most Asian currencies eased slightly, with the ones on the Philippine peso subsiding to an over two-month low, while investors turned bullish on the Indonesian rupiah and the Indian rupee.

Investors were most bearish on the Malaysian ringgit among the pack, but had eased their positions slightly from an over seven-month peak. Bets on yuan alleviated but remained at their highest level since early November.

China, Southeast Asia’s top trading partner and a global manufacturing powerhouse, has had a tough time getting back on its feet since reopening from COVID-19 lockdowns late last year, which was not anticipated by the markets initially but is now being priced in.

While China’s central bank announced some stimulus measures this week, it has failed to impress markets as it fails to improve “the nagging deficit of confidence,” Vishnu Varathan, head of economics & strategy at Mizuho Bank said.

“Any current optimism about China is perversely premised on expectations of further and more emphatic stimulus to compensate for the shortfall in stimulus efforts thus far.”

Analysts at Maybank expect the yuan to weaken further on continued economic weakness and potential of additional easing by the central bank.

Among other currencies, short bets on the Singapore dollar eased to an over one-month low, while those on the Thai baht and the Taiwanese dollar improved marginally.

Meanwhile, investors were barely over the fence for South Korean won, turning bullish for the first time since early February.

The Asian currency positioning poll is focused on what analysts and fund managers believe are the current market positions in nine Asian emerging market currencies: the Chinese yuan, South Korean won, Singapore dollar, Indonesian rupiah, Taiwan dollar, Indian rupee, Philippine peso, Malaysian ringgit and the Thai baht.

The poll uses estimates of net long or short positions on a scale of minus 3 to plus 3. A score of plus 3 indicates the market is significantly long on U.S. dollars.

The figures include positions held through non-deliverable forwards (NDFs).