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EM ASIA FX-Most Asian currencies slip on recession spectre, oil hits Indian rupee

Published 08/29/2019, 02:34 PM
Updated 08/29/2019, 02:40 PM
© Reuters.  EM ASIA FX-Most Asian currencies slip on recession spectre, oil hits Indian rupee
USD/JPY
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* Rising crude weighs on Indian rupee
* Korean won eases ahead of central bank meeting
* Yuan slips despite firmer than expected fix

(Adds text, updates prices)
By Rashmi Ashok
Aug 29 (Reuters) - Most emerging Asian currencies slipped on
Thursday, as global recession worries and anxiety over the
Sino-U.S. trade tussle capped risk appetite while higher oil
prices weighed on India's rupee.
Global bond yields clung near record lows, while the inverse
U.S. yield curve, in which long-date yields are lower than their
short-dated counterparts, stoked fears of a future recession.
MKTS/GLOB
Bets on safe haven assets picked up, with gold prices XAU=
surging to near six-year highs, while the Japanese yen JPY=
traded 0.2% higher.
Despite a firmer than expected central bank fixing, the
onshore Chinese yuan CNY=CFXS weakened past 7.17 against the
dollar for the first time since Feb. 26, 2008.
It had eased for a 10th straight session on Wednesday, the
longest losing streak since December 2015. "Beyond adjusting to tariffs, the CNY is also reacting to
the generalised slowdown in global activities, which is usually
negative for EM currencies, as well as weaker domestic growth,"
analysts at Societe Generale wrote in a note.
Societe Generale also expects policymakers to allow the yuan
to continue to weaken going forward, unless capital outflow
pressures intensify or speculative positioning becomes
excessive.
The Indian rupee INR=IN slipped 0.4%, taking an added hit
from a jump in overnight crude prices, while the Korean won
KRW=KFTC shed 0.2% ahead of its central bank monetary policy
meeting on Friday.
A Reuters poll showed the BoK will likely keep interest
rates unchanged on Friday but cut it at the next meeting in
October as growing trade tensions hit the export-reliant
economy. While economic headwinds continue to build a case for
easing, the BOK will have to fine-tune its actions to control
currency depreciation.
The won's decline past the 1,200 to the dollar level amid an
escalating China-U.S. trade war and a persistently falling yuan
should make the BOK cautious and dissuade it from cutting rates
too fast, analysts at DBS Group said in a note.
"Top officials from the finance ministry have stepped up
verbal interventions this week, warning that the government will
take pre-emptive actions if there is a herd behaviour in the KRW
market," they added.
Bucking the trend, the Philippine peso PHP= recovered
slightly after having shed 0.3% in the previous session.


The following table shows rates for Asian currencies against
the dollar at 0551 GMT.
CURRENCIES VS U.S. DOLLAR

Currency Latest bid Previous day Pct Move
Japan yen 105.860 106.11 +0.24
Sing dlr 1.389 1.3885 -0.04
Taiwan dlr 31.450 31.420 -0.10
Korean won 1216.200 1213.9 -0.19
Baht 30.630 30.6 -0.10
Peso 52.350 52.42 +0.13
Rupiah 14255.000 14250 -0.04
Rupee 72.045 71.77 -0.38
Ringgit 4.223 4.211 -0.28
Yuan 7.168 7.1645 -0.05

Change so far in 2019
Currency Latest bid End 2018 Pct Move
Japan yen 105.860 109.56 +3.50
Sing dlr 1.389 1.3627 -1.89
Taiwan dlr 31.450 30.733 -2.28
Korean won 1216.200 1115.70 -8.26
Baht 30.630 32.55 +6.27
Peso 52.350 52.47 +0.23
Rupiah 14255.000 14375 +0.84
Rupee 72.045 69.77 -3.16
Ringgit 4.223 4.1300 -2.20
Yuan 7.168 6.8730 -4.12


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