* Chinese yuan softens to a 6-week low
* S. Korean won eases as much as 0.7%; July exports -11.0%
y/y
(Adds text, updates prices)
By Niyati Shetty
Aug 1 (Reuters) - Asian currencies weakened against the
dollar on Thursday as the U.S. Federal Reserve doused market
expectations of a lengthy easing cycle after it delivered its
first rate cut in over a decade.
While the Fed's 25-basis-point rate cut on Wednesday was
widely expected, Chairman Jerome Powell said it was "not the
beginning of a long series of rate cuts", wrong-footing some
traders and lifting the greenback to a two-year high. USD/
The Indonesian rupiah IDR= was one of the hardest hit in
the region, easing 0.5% to 14,085 per dollar.
"Against the dovish stances of other central banks, the U.S.
dollar has become a de facto strong currency on monetary policy
divergences," DBS Bank said in a note.
The Chinese yuan CNY=CFXS lost as much as 0.5% to its
lowest level in six weeks. The country's central bank kept its
main policy rates on hold on Thursday, opting not to follow the
Fed cut. Not helping the yuan was the conclusion of brief trade talks
between the United States and China on Wednesday with little
sign of progress, prolonging an uneasy truce in the year-long
trade row. The fallout from the dispute continued to spread across
Asia with factory activity in the region contracting further in
July. Policymakers worry a sustained downturn in world trade
could tip the global economy into a recession, leaving central
banks with depleted ammunition to fight off the pressure.
The Indian rupee INR=IN the Malaysian ringgit MYR= and
the Thai baht THB=TH each softened about 0.4%.
SOUTH KOREAN WON EASES AS ECONOMY FALTERS
The won KRW=KFTC weakened as much as 0.7% to 1,191.10 a
dollar, a more than 2-month low as Asia's fourth largest economy
showed further signs of trouble.
The country's exports tumbled for an eighth straight month
in July, with persistently weak global demand and an escalating
dispute with Japan painting an increasingly gloomy picture for
South Korea. And, the row showed no signs of an imminent resolution.
Japan is expected to give approval for the removal of South
Korea from its list of countries with minimum trade restrictions
as early as Friday. A private survey also showed manufacturing activity
contracted in July to its lowest in five months. following table shows rates for Asian currencies against
the dollar at 0547 GMT.
CURRENCIES VS U.S. DOLLAR
Currency Latest bid Previous day Pct Move
Japan yen 109.180 108.74 -0.40
Sing dlr 1.375 1.3735 -0.12
Taiwan dlr 31.144 31.096 -0.15
Korean won 1186.700 1183.1 -0.30
Baht 30.830 30.72 -0.36
Peso 51.090 50.98 -0.22
Rupiah 14085.000 14012 -0.52
Rupee 69.055 68.79 -0.38
Ringgit 4.143 4.125 -0.42
Yuan 6.900 6.8840 -0.23
Change so far in 2019
Currency Latest bid End 2018 Pct Move
Japan yen 109.180 109.56 +0.35
Sing dlr 1.375 1.3627 -0.91
Taiwan dlr 31.144 30.733 -1.32
Korean won 1186.700 1115.70 -5.98
Baht 30.830 32.55 +5.58
Peso 51.090 52.47 +2.70
Rupiah 14085.000 14375 +2.06
Rupee 69.055 69.77 +1.04
Ringgit 4.143 4.1300 -0.30
Yuan 6.900 6.8730 -0.39