May 2, 2017 / 6:22 AM / 3 months ago

EM ASIA FX- Asian currencies rise as North Korea concerns ease

5 Min Read

 (Adds details, updates prices)
    By Shashwat Pradhan
    May 2 (Reuters) - Most Asian currencies climbed against the
dollar on Tuesday as a slight easing in tensions over the Korean
peninsula offset concerns from a softer-than-expected factory
activity in China.
    U.S. President Donald Trump on Monday opened the door to
meeting North Korea's Kim Jong Un, saying he would be honoured
to meet the young leader under the right circumstances, even as
Pyongyang suggested it would continue its nuclear weapons
tests.
    The comments by Trump, who had warned in an interview with
Reuters on Thursday that a "major, major conflict" with North
Korea was possible, appeared to mark a shift in tone towards the
North Korean leader.
    It took the edge off weeks of rising tensions on the Korean
peninsula and helped push the Korean won up 0.7
percent against the dollar - one of the biggest gainer in Asia
on the day. 
    The won was also buoyed by data showing South Korean exports
rose at a much faster-than-expected pace in April, surging for a
sixth-straight month, aided by strong demand for high-tech
memory chips.
    "Without any military escalation, markets appear biased to
buy the Korean won on dips, banking on positive export growth
and greater political clarity post-elections next week," Mizuho
Bank said in a note.
    Among other currencies, the Malaysian ringgit
appreciated for a fifth-straight day to touch its highest in
more than five months.
    "The Malaysian ringgit has also been a notable outperformer,
with markets turning more positive amidst catch-up inflows and a
liberalization of the onshore forex forwards market," Mizuho
added.
    The Chinese yuan was little changed after a
private survey showed that China's factory sector lost momentum
in April, with growth slowing to its weakest pace in seven
months as domestic and export demand weakened and commodity
prices dipped.
    Meanwhile, the Japanese yen fell to a one-month low
after the dollar was lifted by treasury yields which surged
after U.S. Treasury Secretary Steven Mnuchin commented on the
possibility of ultra long-term bond issuance.
    
    TAIWANESE DOLLAR
    
    The Taiwanese dollar firmed as much as 0.8 percent
to its strongest level against the dollar since Sept. 2014, 
supported by a rally in global tech stocks in the wake of rising
optimism over the prospects for the technology
industry.
    Gain in global tech stocks accelerated after strong earnings
from Alphabet, Amazon and Microsoft
last week. 
    The electronic sector is major export earner in Taiwan, and
includes companies such as Taiwan Semiconductor Manufacturing
, the world's biggest contract chip maker.
    Data from the Nikkei/Markit Taiwan Purchasing Managers'
Index for April showed that Taiwan's April factory growth
slipped to a six-month low, but remained solid.
    The Taiwanese dollar has been the strongest performing
currency in Asia this year.
    
    
    The following table shows rates for Asian currencies against
the dollar at 0546 GMT.
    
 CURRENCIES VS U.S. DOLLAR 
  Currency               Latest bid  Previous day   Pct Move
  Japan yen              111.970           111.83      -0.13
  Sing dlr               1.394             1.3965      +0.18
  Taiwan dlr             30.022            30.218      +0.65
  Korean won             1129.700          1137.9      +0.73
  Baht                   34.530             34.59      +0.17
  Peso                   50.050             49.95      -0.20
  Rupiah                 13300.000          13327      +0.20
  Rupee                  64.178             64.24      +0.10
  Ringgit                4.326              4.339      +0.30
  Yuan                   6.896             6.8970      +0.02
                                                            
  Change so far                                             
  Currency               Latest bid  End 2016       Pct Move
  Japan yen              111.970           117.07      +4.55
  Sing dlr               1.394             1.4490      +3.95
  Taiwan dlr             30.022            32.279      +7.52
  Korean won             1129.700         1207.70      +6.90
  Baht                   34.530             35.80      +3.68
  Peso                   50.050             49.72      -0.66
  Rupiah                 13300.000          13470      +1.28
  Rupee                  64.178             67.92      +5.83
  Ringgit                4.326             4.4845      +3.66
  Yuan                   6.896             6.9467      +0.74
 
    

 (Reporting by Shashwat Pradhan in Bengaluru)
  
 
 

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