March 1, 2017 / 6:08 AM / 5 months ago

EM ASIA FX-Asian currencies fall on rising chance of U.S. March rate hike

4 Min Read

    * Fed officials' remarks boost bets for U.S. March rate hike
    * Trump's speech offers few details on tax reform plans
    * Singapore dollar sheds 0.4 pct vs greenback

 (Adds text, updates prices)
    BENGALURU/SINGAPORE, March 1 (Reuters) - Asian currencies
fell on Wednesday after comments from U.S. Federal Reserve
officials bolstered expectations for a Fed rate hike this month,
even as President Donald Trump's speech lacked details on his
plans for tax reforms.
    The Singapore dollar fell 0.4 percent to 1.4090 to
the U.S. dollar, pulling away from a three-month high of 1.3975
set on Tuesday.
    The Philippine peso slipped 0.2 percent to
50.305, getting close to a 10-year low of 50.355 touched on Feb.
21. 
    The peso has underperformed other Asian currencies and is
the only one to weaken against the dollar this year. One factor
pressuring the peso has been a recent widening of the
Philippines' trade deficit, analysts say
    On Wednesday, Asian currencies fell across the board as the
dollar gained a lift after a handful of Fed policymakers jolted
markets into higher expectations for a U.S. rate hike in March.

    The latest comments from Fed policymakers seemed to
overshadow Trump's speech to Congress, said Sim Moh Siong, FX
strategist for Bank of Singapore.  
    While Trump's speech was light on details, it was not much
of a disappointment, Sim said.
    "It's only a disappointment for people who were looking for
details but I don't think the market had high expectations to
start off with," he added.
    In the long-awaited speech to Congress, Trump said he was
open to immigration reform and touched upon his plans to boost
the U.S. economy through steps such as tax reform and a $1
trillion infrastructure effort.
    Trump said he wanted to provide "massive tax relief" to the
middle class and cut corporate tax rates, but did not offer
specifics.  
    The dollar should advance against emerging Asian currencies
to some extent, prior to the Fed's policy meeting on March
14-15, said Gao Qi, FX strategist for Scotiabank in Singapore.

    CURRENCIES VS U.S. DOLLAR     
  Change on the day at   0532 GMT                       
  Currency                Latest bid   Previous      Pct
                                            day     Move
  Japan yen                   113.49     112.78    -0.63
  Sing dlr                    1.4090     1.4030    -0.43
  Taiwan dlr                  30.710     30.650    -0.20
  Korean won                 1130.70    1130.70    +0.00
  Baht                         34.99      34.90    -0.27
  Peso                        50.305     50.210    -0.19
  Rupiah                       13360      13331    -0.22
  Rupee                        66.85      66.69    -0.24
  Ringgit                     4.4480     4.4380    -0.22
  Yuan                        6.8776     6.8687    -0.13
                                                        
  Change so                                             
 far in 2017                                     
  Currency                Latest bid   End prev      Pct
                                           year     Move
  Japan yen                   113.49     117.07    +3.15
  Sing dlr                    1.4090     1.4490    +2.84
  Taiwan dlr                  30.710     32.279    +5.11
  Korean won                 1130.70    1207.70    +6.81
  Baht                         34.99      35.80    +2.31
  Peso                         50.31      49.72    -1.16
  Rupiah                       13360      13470    +0.82
  Rupee                        66.85      67.92    +1.60
  Ringgit                     4.4480     4.4845    +0.82
  Yuan                        6.8776     6.9467    +1.00
 
 (Reporting by Patturaja Murugaboopathy in Bengaluru and
Masayuki Kitano in Singapore; Editing by Richard Borsuk)
  
 
 

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