Most Asian Currencies Edge Lower Amid US Tariff Concerns
Most Asian currencies edged lower on Thursday, extending their subdued performance amid concerns over new US tariffs under Donald Trump’s administration. The Bank of Japan’s policy meeting, set to begin later in the day, is also expected to draw attention.
The Bank of Japan is widely expected to raise interest rates at the end of its two-day meeting on Friday, with analysts citing encouraging inflation and wage data as support for the decision. Media reports suggest the BoJ will likely signal further interest rate hikes if the economy maintains its recovery.
The Japanese yen was largely muted ahead of the rate decision. Other regional currencies were under pressure in anticipation of additional US tariffs, which could have a substantial impact on most Asian currencies given the region’s heavy dependence on trade with China.
The Chinese yuan’s onshore pair inched 0.1% higher, while the offshore pair was largely unchanged. The Malaysian ringgit’s pair rose 0.2%, a day after the Bank Negara Malaysia held steady for the 10th straight meeting. The Australian dollar’s pair and the Singapore dollar’s pair were both largely muted.
The Indonesian rupiah’s pair and the Indian rupee’s pair inched 0.1% lower, each. The South Korean won’s pair was slightly higher amid an ongoing political crisis in the country.
The US dollar has faced pressure as investors assess the economic consequences of Trump’s gradual implementation of tariffs. The greenback had fallen more than 1% at the start of the week after Trump avoided details on tariffs, signaling they could come at a slower pace. The dollar was largely muted during Asian trading, after ticking higher a day earlier.