September 18, 2017 / 5:18 AM / a year ago

EM ASIA FX-Regional currencies reined in by caution ahead of Fed meeting

 (Adds text, updates prices)
    By Anusha Ravindranath
    Sept 18 (Reuters) - Most Asian currencies made little
headway on Monday with the dollar hovering near seven-week highs
and caution growing ahead of the U.S. Federal Reserve's policy
    At its two-day meeting starting on Tuesday, the Fed is
expected to kick off a long-anticipated reduction of its bloated
balance sheet, but leave interest rates unchanged after raising
them twice this year.
    The focus will be on any comments on inflation or other
trends that could change the markets' blase view on the chance
of a third hike in December.
    "Asian currencies are broadly mixed today. On the one hand
the continued strength in US equities and risk sentiment has
been supportive while on the other, the Fed and related concerns
are likely to remain in focus." said Dushyant Padmanabhan, an FX
strategist at Nomura. 
    "A balance sheet adjustment is largely expected by the
market, and an announcement as such should have a relatively
limited impact. However another factor to watch is whether the
Fed adjusts their projections of the fed funds rate (the “dots”)
in this meeting, which could have a more material impact on the
US dollar." he said.
    The dollar held near a seven-week high versus the yen on
Monday, supported by recent rises in U.S. Treasury yields.

    In Asia, trading in most currencies remained broadly
subdued. However, Malaysian ringgit rose to a more than
one-week high, while Won gained as much as 0.5
The won recouped much of its losses from last week as traders
looked past recent North Korean provocations. 
    North Korea had fired a missile over northern Japan on
Friday, not long after Pyongyang's latest and most powerful
nuclear test.
    Simmering tensions in the Korean Peninsula had made the
currency a risky bet for investors with sentiment towards won
weakening to its lowest since mid- January, a recent poll of 12
analysts, traders and fund managers showed.
    "Markets have largely looked beyond bouts of geopolitical
risks triggered by North Korea’s ongoing missile tests. " Mizuho
Bank said in a note.
    The currency has appreciated about 7 percent against the
dollar this year. 
    The baht traded at 33.08 against the dollar on
    The Thai central bank governor said the bank "acted on some
speculation in the currency", but did not provide further
    In August, the central bank had asked commercial banks for
data on an “unusually high volume of transfers between
non-resident baht accounts which may relate to baht speculation”
and warned it might “consider additional measures to limit the
opportunity” to drive the currency higher.
    Driven by stronger economic growth and easing political
uncertainities in Thailand, the baht has appreciated about 8
percent against the greenback this year, becoming Asia's best
performing currency.
The following table shows rates for Asian currencies against the
dollar at 0446 GMT.
  Change on the day at                           
        0446 GMT                            
  Currency                Latest  Previous    Pct
                             bid       day   Move
  Japan yen              111.140    110.84  -0.27
  Sing dlr               1.344      1.3450  +0.10
  Taiwan dlr             30.069     30.075  +0.02
  Korean won             1126.50    1131.7  +0.46
  Baht                   33.079      33.08  +0.00
  Peso                   51.185     51.165  -0.04
  Rupiah                 13237.0     13238  +0.01
  Rupee                  64.015      64.07  +0.09
  Ringgit                4.183       4.188  +0.12
  Yuan                   6.549      6.5500  +0.02
  Change so far                                  
  Currency               Latest   End 2016    Pct
                         bid                 Move
  Japan yen              111.140    117.07  +5.34
  Sing dlr               1.344      1.4490  +7.84
  Taiwan dlr             30.069     32.279  +7.35
  Korean won             1126.50   1207.70  +7.21
  Baht                   33.079      35.80  +8.23
  Peso                   51.185      49.72  -2.86
  Rupiah                 13237.0     13470  +1.76
  Rupee                  64.015      67.92  +6.10
  Ringgit                4.183      4.4845  +7.21
  Yuan                   6.549      6.9467  +6.08

 (Reporting by Anusha Ravindranath in Bengaluru; Editing by Kim
0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below