Asian FX loses steam ahead of U.S. jobs data; Philippine peso firms
Most emerging Asian currencies pared
earlier gains on Friday, as the U.S. dollar strengthened ahead
of a crucial jobs data, overshadowing a boost from China’s
recent reopening plans and policy support measures for the
country’s property sector.
The Philippine peso, however, hit a one-week high, up
0.3% against the dollar, a day after the country’s central bank
pledged further action to tackle inflation, which hit a 14-year
high in December.
Aiding the currency’s moves was a “decline in global crude
oil prices during the week that could ease inflationary
pressures and help narrow the country’s trade deficit/net
imports,” said Michael L. Ricafort, chief economist at Rizal
Commercial Banking Corp.
The dollar held near an almost one-month high, as
market bets on further rate hikes strengthened after data on
Thursday pointed to a still-tight U.S. labor market.
“Coming ahead of the noteworthy non-farm payrolls report, we
see scope for some near-term dollar strength as a result,” MUFG
Bank analyst Jeff Ng said.
U.S. jobs data due later in the day could provide clues on
how aggressive the Federal Reserve will be in tightening policy
The greenback strength led most Asian currencies to pare
The Thai baht traded flat, but it was set to post
the biggest weekly gain among regional peers in the first week
of 2023, buoyed by hopes of increased tourism from China as it
gradually reopens its borders.
Chinese investors are doubling down on economic recovery
bets, with a flurry of new fund launches this week riding on
optimism about an end to COVID restrictions, though money
managers warn the next wave of market gains will be less
The yuan rose 0.3%.
The Singaporean dollar and the South Korean won
also pared gains to trade flat.
The Indonesian rupiah and the Malaysian ringgit
fell 0.2% each, while the Japanese yen slipped
The yen has weakened more than 2% against the dollar during
the week. Earlier in the week, Prime Minister Fumio Kishida
reiterated his resolve to maintain ultra-loose monetary policy
to sustainably achieve 2% inflation.
Meanwhile, the dollar’s vice grip on FX markets will loosen
a bit this year, according to a Reuters poll, where analysts
expect most currencies to post marginal gains against the
greenback over the coming 12 months.
Among Asian equities, Philippine stocks fell 0.8%,
while those in Malaysia and India dipped 0.4%
Indonesian stocks rose 0.7%, but they were set to
drop 2.2% for the week, the biggest drop among regional equities
on news of China’s partial easing of its Australian coal imports
Thai stocks gained 0.7%, while Seoul stocks
climbed 1.2% on chipmakers’ boost.
** Taming inflation is the top priority for South Asian
countries as risks to growth and investment outlook could rise
if price pressures persist at high levels, Reserve Bank of India
(RBI) governor Shaktikanta Das said
** China Energy Investment Corp has placed an order to
import Australian coal, three sources familiar with the matter
said, in one of the first deals since Beijing eased an
unofficial ban imposed on coal imports from Australia in 2020
** Indonesia’s foreign exchange reserves rose to $137.2
billion at the end of December, the highest in nine months, the
central bank said
Asia stock indexes and
currencies at 0840 GMT
COUNTRY FX RIC FX FX INDE STOCK STOCK
DAILY YTD % X S S YTD
% DAILY %
Japan -0.57 -2.27 <.n2>
India -0.08 +0.12 <.ns ei>
Indones -0.19 -0.45 <.jk ia se>
Malaysi -0.23 +0.11 <.kl a se>
Philipp +0.34 +0.07 <.ps ines i>
Singapo +0.02 -0.38 <.st re i>
Taiwan -0.08 -0.09 <.tw ii>
Thailan -0.04 +1.63 <.se d ti>
(Reporting by Savyata Mishra in Bengaluru; Editing by Kim
Coghill and Rashmi Aich)
Comments are closed.