Latest news with #AsianCurrencies
Reuters
a day ago
- Business
- Reuters
Bullish bets surge on Asian currencies as US-China thaw, trade deals rattle dollar
May 29 (Reuters) - Investors piled up bullish bets on Asian currencies, including the yuan, as easing U.S.-China tariff tensions, new trade deals and a growing unease with U.S. policies prompted them to pull out of dollar assets, a Reuters poll showed on Thursday. Investors sought long positions across the board, with those in the Taiwanese dollar and Philippine peso climbing to their highest since the end of 2020, according to the fortnightly poll of 10 respondents. All responses were collected before a U.S. trade court on Wednesday blocked President Donald Trump's sweeping tariffs, ruling he overstepped his authority by imposing duties on countries with trade surpluses against the United States. Long bets on the Chinese yuan were the highest since October last year - a month before Donald Trump was re-elected as the President of the United States - buoyed by signs of renewed dialogue on trade between Washington and Beijing after months of posturing and threats. The yuan rose 1% this month. Trump's tariff flip-flops and the mounting worries over a ballooning U.S. deficit have dented confidence in American assets, piling pressure on the dollar and driving investors toward Asian currencies. "Asian currencies are likely to stay firm against the U.S. dollar (USD) due to diversification outflows from USD assets into Asia, with investors being concerned over U.S. trade policy and its fiscal trajectory given proposed tax cuts", said Wei Liang Chang, market strategist at DBS Bank. Southeast Asian leaders have also reached an understanding that any bilateral agreements they might strike with the United States on trade tariffs would not harm the economies of fellow members. Parisha Saimbi, an FX strategist at BNP Paribas, said Asian currencies would remain somewhat supported, helped by the U.S.-China de-escalation and bilateral trade deals being reached. Meanwhile, the Taiwanese dollar has gained more than 6% in May to record its best ever monthly gain. Taiwan's president dismissed "false" claims of currency talks with Washington earlier in May, after the Taiwan dollar spiked on speculation the U.S. had pushed for its appreciation, fuelling market jitters over potential FX policy shifts. The South Korean won has also jumped more than 4% this month amid a broad dollar selloff, with Seoul officials confirming currency policy was on the table during recent talks with U.S. counterparts in Milan, fuelling speculation of joint FX moves. Bullish bets returned to the Indonesian rupiah for the first time since October 2024, as some investors looked past ongoing fiscal concerns and bet on policy direction stabilising. Elsewhere, bullish bets on the Malaysian ringgit and Thai baht rose to their strongest levels since October 2024. 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 U.S. dollars. The figures include positions held through non-deliverable forwards (NDFs). The survey findings are provided below (positions in U.S. dollar versus each currency):
Zawya
3 days ago
- Business
- Zawya
Asian currencies retreat after bonds rally; US fiscal, trade concerns persist
Reuters - Asian currencies reversed course to trade lower on Tuesday as a rally in global bonds whipsawed markets that remained concerned about U.S. fiscal health and President Donald Trump's erratic trade policies. The Malaysian ringgit fell 0.3% against a stronger dollaer after reaching a three-week high earlier in the session. The Singaporean dollar, Indonesian rupiah, and the Indian rupee weakened between 0.2% and 0.4%. U.S. Treasury yields slumped after 30-year bonds mimicked a steep price rally in longer-term Japanese debt and as investors mulled the latest developments in U.S. tariff policy. Trump's policy reversals and his sweeping spending and tax-cut bill have turned investors off U.S. assets. In the latest example, two days after threatening to slap 50% tariffs on imports from the European Union next month, Trump restored a July 9 deadline for talks. "There are three major things driving not just Asia but global markets at the moment: concerns about U.S. debt and deficits, trade deals and the diversification away from the dollar," said Michael Wan, a senior currency analyst at MUFG. "The big picture is that U.S. assets are reasonably over-valued, and there has been a build-up of these assets over time which could impact the general flow of assets moving forward." Asian currencies have benefited from broader weakness in the greenback this month, with the dollar index heading for a fifth straight month of declines against a basket of currencies, which would mark the longest such losing streak since 2017. Taiwan's dollar is on course to log its best monthly performance on record, buoyed by a historic 6% spike over two days in early May. It was last trading flat at 29.939 per dollar. The South Korean won, which has gained more than 4% so far this month, was last down 0.2%. The Thai baht weakened 0.4%. Thailand's commerce ministry has warned that exports in the second half will face a risk of U.S. tariffs after a moratorium expires in July. Meanwhile, the country's finance minister said the tariffs could see the economy stumble, with growth potentially falling to just over 1% this year. Equities in Bangkok fell as much as 1.6% to a near one-month low. Other regional stock markets were also weaker with shares in Kuala Lumpur, Taipei and Seoul falling between 0.3% and 0.9%. HIGHLIGHTS: ** Thailand's foreign tourist arrivals so far this year fall 2.55% y/y ** China's industrial profits maintain growth momentum in April despite trade tensions ** Asian hedge funds regain lost ground in May, increasing leverage Asia stock indexes and currencies at 0734 GMT Japan -0.54 +9.44 0.51 -5.44 China India -0.35 +0.28 -0.61 5.09 Indonesi -0.28 -1.17 -0.25 1.28 a Malaysia -0.28 +5.70 -0.60 -7.14 Philippi -0.16 +4.71 -0.08 -2.21 nes Singapor -0.19 +6.12 0.27 2.60 e Taiwan -0.02 +9.49 -0.93 -7.37 Thailand -0.37 +4.86 -1.14 -16.80
Reuters
4 days ago
- Business
- Reuters
Rupee rises above 85/USD hoisted by fragile dollar, stronger yuan
MUMBAI, May 26 (Reuters) - The Indian rupee and other Asian currencies extended their recent rallies on Monday, as abrupt shifts in U.S. trade policy and concerns over fiscal health kept the dollar under pressure. The rupee rose past the 85 per U.S. dollar mark for the first time in two weeks on Monday, extending its 0.9% surge seen on Friday. The currency was last quoted up 0.4% at 84.82. The dollar index was hovering at an over one-month low of 98.8, down 0.3% on day, after U.S. President Donald Trump set a July 9 deadline for a trade deal with the European Union after threatening a 50% tariff from June 1. Meanwhile, the Chinese yuan's rise to a 7-month high, following provided another tailwind to regional currencies. Asian currencies have risen by as much as 7% on the month so far but the rupee has remained a laggard with a 0.3% decline. "Markets have also seemingly perceived that President Trump is looking for a weaker US dollar versus several Asian currencies as part of bilateral trade negotiations," MUFG Bank said in a note. "Any signs of FX discussion with the US could still be an upside risk to Asian currencies in the near term," the note added. Meanwhile, dollar-rupee forward premiums fell on Monday as the rupee extended its recent rally and near-tenor U.S. bond yields nudged higher. The 1-year dollar-rupee implied yield dipped below the 2% handle for the first time in two months and was last quoted at 1.99%. Uncertainty about future path of Federal Reserve policy rates alongside firm expectations of rate cuts by the Reserve Bank of India may continue to weigh on dollar-rupee forward premiums in the near-term, a trader at a bank said.
Reuters
5 days ago
- Business
- Reuters
Rupee set to extend rally, riding momentum in Asia FX
MUMBAI, May 26 (Reuters) - The Indian rupee is poised to kick off the week on a positive note, extending Friday's rally, buoyed by a strength in Asian currencies which included the Chinese yuan's surge to a seven-month high. The 1-month non-deliverable forward indicated that the rupee will open in the 84.98-85.02 range per U.S. dollar on Monday, from its Friday close of 85.2125. The currency had surged 0.92% on Friday, its best single-day performance in over two years. Friday marked an unexpected turnaround in the rupee's performance. Until then, the Indian currency had largely missed out on the rally enjoyed by its Asian peers. "Difficult to pinpoint what exactly changed on Friday. In hindsight, it may have been the lack of dollar payments that had been plaguing the rupee, the relentless up move in Asia and finally the collective wisdom that a short (on dollar/rupee) offers value, " a currency trader at a Mumbai-based bank said. However, despite Friday's rally, the rupee remains an underperformer among Asian FX this month. While the rupee is down 0.8% in May, the Korean won, Thai baht, and Indonesian rupiah have climbed between 2.5% and 5.5%. Meanwhile, the offshore Chinese yuan has strengthened 1.5% to 7.1650 against the dollar. The dollar weakened against its major peers and Asian currencies on Monday, with the dollar index (=USD) slipping 0.3% to 98.76 — not far from its year-to-date low. Expectations of FX revaluation have supported Asian currencies, while U.S. fiscal concerns continue to weigh on the dollar. Meanwhile, U.S. President Donald Trump on Sunday backed off his threat to speed up 50% tariffs on imports from the European Union, agreeing to extend his deadline for trade talks until July 9. The rapid de-escalation — just two days after the initial threat — underscores the unpredictability and volatility of U.S. trade policy. KEY INDICATORS: ** One-month non-deliverable rupee forward at 85.14; onshore one-month forward premium at 13.5 paisa ** Dollar index down at 98.72 ** Brent crude futures up 0.1% at $64.8 per barrel ** Ten-year U.S. note yield at 4.51% ** As per NSDL data, foreign investors sold a net $634.6 million worth of Indian shares on May 22 ** NSDL data shows foreign investors sold a net $53.4 million worth of Indian bonds on May 22
Wall Street Journal
22-05-2025
- Business
- Wall Street Journal
Asian Currencies Consolidate as Traders Assess Risks of Rising U.S. Deficits
0043 GMT — Asian currencies consolidate against the dollar in the early session as traders assess risks of rising U.S. deficits exacerbated by a weak 20-year Treasury auction overnight. 'Concern about impending U.S. tax cuts against the backdrop of already high government debt has pushed up Treasury yields and weighed on USD this week,' CBA's Kristina Clifton says in a research report. However, 'the lack of serious alternatives to the U.S.'s deep and liquid debt market will put a floor under U.S. bonds and the USD in the near term,' the senior economist and senior currency strategist adds. ICE USD Index is steady at 99.56; USD/KRW edges 0.2% higher to 1,377.14; USD/JPY is down 0.2% at 143.38. (
