(Adds text, updates prices)
May 17 Most emerging Asian currencies inched up
on Wednesday as the dollar came under further pressure after
reports that U.S. President Donald Trump asked then-FBI Director
James Comey to end a probe into Trump's former national security
Trump asked Comey to end the FBI investigation into ties
between former White House National Security Advisor Michael
Flynn and Russia, according to a source who has seen a memo
written by Comey.
Trump later fired Comey whose dismissal sparked a furore
which was soon followed by more outrage over Trump's alleged
sharing of classified intelligence with Russian Foreign Minister
Sergei Lavrov at a meeting in Trump's office.
The reports of Comey's memo raised questions over whether
obstruction of justice charges could be laid against Trump,
weakening confidence in the U.S. president's ability to push
through an aggressive stimulus programme that investors had been
banking on since his election last November.
"As reporting intensifies on Trump's potential mishandling
of classified information, markets are becoming concerned
whether key legislation on tax reforms could be deferred or
derailed," said Mizuho Bank in a note.
The tumult at the White House prompted currency traders to
ditch the dollar to favour a broad range of currencies, most
notably against the yen, to which investors often turn as a safe
haven when there are problems in the United States.
The yen strengthened 0.7 percent against the dollar
to touch a more than one-week high.
The dollar was also dented by a report that U.S. housing
starts dropped 2.6 percent to a seasonally adjusted annual rate
of 1.17 million units, the lowest level in five months, hurt by
persistent weakness in the construction of multi-family
In other Asian currencies, Malaysian ringgit
appreciated 0.1 percent against the dollar.
Malaysian consumer prices in April were 4.4
percent higher than a year earlier, just below the 4.5 percent
annual pace forecast in a Reuters poll, and down from March's
5.1 percent, the highest rate in eight years.
Meanwhile, the Korean won reversed earlier gains
to fall 0.3 percent, as traders took profits after currency hit
six-week high a day earlier.
The yuan nudged higher on Wednesday after China
set its official midpoint at 6.8635 per dollar prior
to the market open on Wednesday, its strongest level since
February 17, reflecting the U.S. currency's weaker global trend.
Wednesday's fixing was 62 pips, or 0.23 percent, firmer than
the previous setting at 6.8790.
Additionally, Hong Kong and Chinese regulators formally
approved a long-awaited scheme to connect China's $9 trillion
bond market with overseas investors.
"We expect flows into China's bond market to increase as a
result of the bond connect between Hong Kong and Mainland China.
This may in turn support the central bank to loosen its capital
controls," OCBC Bank said in a note.
The currency is on track to rise for a fourth straight day
against the dollar in what will be its longest streak of gains
since November 2016.
The Taiwanese dollar drifted marginally lower to
30.124 on Wednesday, remaining on track to end a four-day
winning streak against the dollar.
Inflows into Taiwanese equities dropped to around $1 billion
in April, from more than $2 billion in March.(reut.rs/2rhT2cB)
But the non-deliverable outright market expects
the currency to appreciate to 29.698 against the dollar in a
Taiwan's central bank Governor Perng Fai-nan has been
looking at ways to get Taiwan off the U.S. government's list of
possible currency manipulators by turning on its head a
decades-old policy of keeping the currency weak.
The following table shows rates for Asian currencies against
the dollar at 0553 GMT.
CURRENCIES VS U.S. DOLLAR
Currency Latest bid Previous day Pct Move
Japan yen 112.390 113.11 +0.64
Sing dlr 1.393 1.3949 +0.16
Taiwan dlr 30.124 30.115 -0.03
Korean won 1119.500 1116 -0.31
Baht 34.480 34.51 +0.09
Peso 49.730 49.68 -0.10
Rupiah 13305.000 13296 -0.07
Rupee 64.025 64.08 +0.09
Ringgit 4.313 4.32 +0.16
Yuan 6.887 6.8880 +0.02
Change so far
Currency Latest bid End 2016 Pct Move
Japan yen 112.390 117.07 +4.16
Sing dlr 1.393 1.4490 +4.04
Taiwan dlr 30.124 32.279 +7.15
Korean won 1119.500 1207.70 +7.88
Baht 34.480 35.80 +3.83
Peso 49.730 49.72 -0.02
Rupiah 13305.000 13470 +1.24
Rupee 64.025 67.92 +6.08
Ringgit 4.313 4.4845 +3.98
Yuan 6.887 6.9467 +0.87
(Reporting by Shashwat Pradhan in Bengaluru)