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EM ASIA FX-Investors stay on sidelines as all eyes turn to Powell

Published 07/10/2019, 02:12 PM
Updated 07/10/2019, 02:20 PM
EM ASIA FX-Investors stay on sidelines as all eyes turn to Powell
DXY
-

* 6.90 to dollar may be line in sand for China's yuan -
Maybank
* Won weakens, S.Korea says Japan export curbs may be
prolonged
* Baht slips, c.bank preparing steps to control short-term
inflows

(Adds text, updates prices)
By Devika Syamnath
July 10 (Reuters) - Emerging Asian currencies made only
small moves on Wednesday, as investors waited for congressional
testimony by Federal Reserve Chairman Jerome Powell for clues on
the odds of a near-term easing of U.S. monetary policy.
There was no common trend in Asian units, with both marginal
losses and gains against the dollar .DXY which firmed on
higher Treasury yields before Powell's remarks later on
Wednesday.
Strong U.S. jobs data last week doused market hopes for a
large rate cut at the July 30-31 Fed meeting, but a small cut is
still widely expected.
"With odds of a 50bps cut at the end of the month now
essentially ruled out, intra-day extension of discretionary USD
strength may stall ahead of Powell's testimony before Congress,"
said OCBC in a note.
The Taiwan dollar TWD=TP , which rose against the dollar on
Tuesday, was again up, by 0.1%.
Data on Monday showed exports from trade-dependent Taiwan
unexpectedly grew for the first time in eight months in June.
The South Korean won KRW=KFTC slipped 0.1%. In the latest
development in a trade dispute, South Korea's president said
Japan's export curbs on key materials used by South Korean
technology firms could be prolonged. India's rupee INR=IN was 0.1% weaker. U.S. President
Donald Trump on Tuesday reiterated his complaints that Indian
tariffs on U.S. products were unacceptable. The Thai baht THB=TH declined 0.1%.
Minutes from a June policy meeting showed Thailand's central
bank is preparing measures to control short-term capital
inflows, to temper rapid strength in the baht that may be
inconsistent with economic fundamentals. LINE IN THE SAND?
China's yuan CNY=CFXS was marginally higher at 6.887 after
U.S. and Chinese officials held a "constructive" phone
conversation on Tuesday, marking fresh attempts to resolve
differences over a bruising tariff exchange that has weighed on
global growth. MKTS/GLOB A Maybank note said "With trade talks resuming and Trump so
sensitive to yuan depreciation, 6.90 may well be the line in the
sand for now."
June inflation numbers out of China raised concerns that
slowing manufacturing activity amid the U.S.-China trade war was
rubbing off on growth in the world's no. 2 economy. following table shows rates for Asian currencies against
the dollar at 0521 GMT.

CURRENCIES VS U.S. DOLLAR

Currency Latest bid Previous day Pct Move
Japan yen 108.870 108.84 -0.03
Sing dlr 1.362 1.3618 +0.01
Taiwan dlr 31.143 31.181 +0.12
Korean won 1181.700 1180.5 -0.10
Baht 30.860 30.82 -0.13
Peso 51.500 51.43 -0.14
Rupiah 14135.000 14125 -0.07
Rupee 68.585 68.54 -0.07
Ringgit 4.140 4.141 +0.02
Yuan 6.886 6.8880 +0.04

Change so far in 2019
Currency Latest bid End 2018 Pct Move
Japan yen 108.870 109.56 +0.63
Sing dlr 1.362 1.3627 +0.08
Taiwan dlr 31.143 30.733 -1.32
Korean won 1181.700 1115.70 -5.59
Baht 30.860 32.55 +5.48
Peso 51.500 52.47 +1.88
Rupiah 14135.000 14375 +1.70
Rupee 68.585 69.77 +1.73
Ringgit 4.140 4.1300 -0.24
Yuan 6.886 6.8730 -0.18


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