Asia FX muted, dollar steady ahead of more Fed cues; yen stays fragile By

Asia FX muted, dollar steady ahead of more Fed cues; yen stays fragile By
Asia FX muted, dollar steady ahead of more Fed cues; yen stays fragile By– Most Asian currencies weakened slightly on Monday, while the steadied as traders expected more cues on interest rates from the Federal Reserve this week.

The Japanese yen remained fragile after reversing a bulk of its gains made on likely currency market intervention by the government earlier in May. But further losses in the yen were stymied by the potential for more intervention.

Broader currencies weakened slightly as traders remained on edge over the path of US interest rates.

Chinese yuan weak as PBOC keeps LPR unchanged

The Chinese yuan’s pair rose 0.1% after the People’s Bank kept its benchmark unchanged at record lows.

While sentiment towards China improved over the past week amid more stimulus and policy support from Beijing, the yuan saw little strength as increased stimulus in the country pointed to more downward pressure on the currency.

A potential trade war between the US and China also kept investors on edge, after China reportedly imposed new trade restrictions on some US companies, in apparent retaliation for a recent hike in US tariffs on key Chinese industries.

Concerns over China kept other currencies with trade exposure to the country under pressure. The Australian dollar’s pair rose 0.1%, while the South Korean won’s pair rose 0.5%.

The Singapore dollar’s pair was flat.

Japanese yen fragile, more intervention eyed

The Japanese yen’s pair rose slightly on Monday, and remained close to breaking back above the 156 yen level.

While the pair had fallen as low as 151 earlier in May, following apparent government intervention, it reversed a bulk of these losses as persistent fears of high US interest rates and little action by the Bank of Japan battered the Japanese currency.

3rd party Ad. Not an offer or recommendation by See disclosure here gold
remove ads

Still, traders remained cautious over taking the USDJPY pair past the 156 level, amid some concerns that it could attract more intervention by the government.

Dollar steady with more Fed cues on tap

The and moved little in Asian trade on Monday, steadying after clocking losses last week.

Some softer-than-expected US consumer inflation readings pushed up hopes that the Fed will begin cutting interest rates by September. But a string of Fed officials warned that the bank needed more confidence that inflation was retreating.

Focus this week is on more cues from the central bank, with the of its late-April meeting due on Wednesday.

A string of Fed officials- especially members of the bank’s rate-setting committee- are also set to speak this week.



PREV the Maxima fashion marathon in Albany
NEXT The forest fire, now contained, would be of “accidental origin”