August 22, 2018 / 6:23 AM / 9 months ago

Asian currencies muted ahead of U.S.-China trade talks

(Reuters) - Most Asian currencies traded sideways on Wednesday as investors shied from taking positions ahead of Sino-U.S. trade talks later in the day.

FILE PHOTO: A China yuan note is seen in this illustration photo May 31, 2017. REUTERS/Thomas White/Illustration/File Photo

Holidays in the region also kept volumes low. The Indian, Indonesian, Malaysian and Singapore markets were closed.

Lower-level talks between the United States and China expected to begin later in the day in Washington had prompted some risk appetite to creep back into the region as hopes for easing trade tensions rose.

Investors had pulled out of the dollar as risk appetite for Asia increased. The greenback was further pressured by U.S. President Donald Trump’s criticism of Federal Reserve rate hikes, and was subdued for the day.

Investors also awaited minutes of the Fed’s July 31-Aug. 1 policy meeting, due at 1800 GMT.

China’s yuan firmed about 0.1 percent versus the dollar and was on track to gain for a fifth straight session.The currency has been underpinned by a dip in the dollar for the past few sessions, as well as a stronger daily mid-point fixing from the People’s Bank of China.

The Thai baht edged lower to break a four-session run of gains following disappointing July export data.

Exports, a key driver of Thai growth, rose 8.27 percent in July from a year earlier, after posting annual growth of 8.19 percent in June.

However, July’s data fell short of the median forecast of 9.8 percent in a Reuters poll and Thailand also registered a trade deficit in July.

The Taiwan dollar inched up against the dollar, and was set to gain for a fifth straight session. Export orders grew faster than expected in July, data out on Monday showed.

Taiwan depends largely on the export of electronic goods, and export orders are a leading indicator of demand for Asia’s hi-tech gadgets and other products.

South Korea’s won and the Philippine peso fell slightly.

Reporting by Ambar Warrick in Bengaluru; Editing by Eric Meijer

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