(Adds commentary, updates prices)
By Patturaja Murugaboopathy
Oct 16 (Reuters) - Most Asian currencies fell on Wednesday
on fresh worries about China-U.S. ties as political unrest in
Hong Kong became a new flashpoint in strained relations between
the world's two largest economies, knocking appetite for
regional units.
The U.S. House of Representatives on Tuesday passed new
measures related to pro-democracy protests in Hong Kong, which
would require the U.S. secretary of state to certify every year
the Hong Kong was retaining its autonomy. The legislation would damage China's relationship with the
United States if it becomes law, China's foreign ministry said
on Wednesday, adding to the stress of already difficult trade
negotiations between Washington and Beijing.
"Final passage of the bill would draw the ire of the Chinese
government and probably reduce any chances of a U.S. China trade
deal, even a mini one," said MUFG Bank in a report.
"This outcome would be negative for financial markets and
have more negative implications for global trade, particularly
Asia-ex Japan."
Hong Kong has been rocked by massive marches and at times
violent protests involving teargas, petrol bombs and live
rounds, over concerns Beijing is tightening its grip on the city
and eroding democratic rights.
Beijing rejects the charge and accuses Western countries,
like the United States and Britain, of stirring up trouble.
Also weighing on sentiment was waning optimism about a
breakthrough in U.S.-China trade negotiations with earlier news
about both sides reaching a first phase of a new deal failing to
yield any concrete details.
Bloomberg reported that China would struggle to buy $50
billion of U.S. farm goods annually unless it removes
retaliatory tariffs on American products, which would require
reciprocal action by U.S. President Donald Trump.
China's yuan CNY=CFXS fell 0.2% on Wednesday after its
central bank set the midpoint at its weakest level since Sept.
12, 38 pips lesser than Reuters' estimate of 7.0708.
"This USDCNY fix was telling, as it serves to reinforce the
message of potential retaliation should the US Congress
continues to act in support of Hong Kong protesters," Maybank
said in a note.
The Indian rupee INR=IN also dropped on worries over its
economy after the International Monetary Fund (IMF) cut its
growth projection to 6.1% from 7% on concerns over corporate and
regulatory uncertainty. The U.S.-China trade war will cut 2019 global growth to its
slowest pace since the 2008-2009 financial crisis, the IMF
warned, but said output would rebound if their duelling tariffs
were removed. The South Korean won KRW=KFTC lost 0.24% against the
dollar after its central bank cut its policy interest rate in
efforts to prop up the slowing economy and flagged the
likelihood of further easing. The Malaysian ringgit MYR= fell on worries that India, the
biggest buyer of Malaysian palm oil so far in 2019, could raise
import taxes or enforce other measures to curb imports from
Malaysia.
India's government was angered after Malaysian Prime
Minister Mahathir Mohamad said last month at the United Nations
that India had "invaded and occupied" Jammu and Kashmir and
asked New Delhi to work with Pakistan to resolve the issue.
The Philippine peso PHP=PH and Indonesian rupiah IDR=ID
also fell sharply on the day.
The following table shows rates for Asian currencies against
the dollar at 0533 GMT.
CURRENCIES VS U.S. DOLLAR
Change on the day
at 0533 GMT
Currency Latest Previou Pct
bid s day Move
Japan yen 108.66 108.84 +0.17
0
Sing dlr 1.372 1.3705 -0.08
Taiwan dlr 30.670 30.686 +0.05
Korean won 1187.8 1185.2 -0.22
00
Baht 30.400 30.35 -0.16
Peso 51.660 51.59 -0.14
Rupiah 14175. 14160 -0.11
000
Rupee 71.500 71.54 +0.06
Ringgit 4.193 4.189 -0.10
Yuan 7.095 7.0819 -0.19
Change so far in
2019
Currency Latest End Pct
bid 2018 Move
Japan yen 108.66 109.56 +0.83
0
Sing dlr 1.372 1.3627 -0.65
Taiwan dlr 30.670 30.733 +0.21
Korean won 1187.8 1115.70 -6.07
00
Baht 30.400 32.55 +7.07
Peso 51.660 52.47 +1.57
Rupiah 14175. 14375 +1.41
000
Rupee 71.500 69.77 -2.42
Ringgit 4.193 4.1300 -1.50
Yuan 7.095 6.8730 -3.13