🔺 What to do when markets are at an all-time high? Find smart bargains, like these.See Undervalued Stocks

Asia FX muted amid rate, election jitters; yen fragile ahead of BOJ

Published 2024/10/30, 06:24
© Reuters.
USD/JPY
-
AUD/USD
-
USD/SGD
-
USD/INR
-
USD/KRW
-
USD/CNY
-
DX
-
DXY
-

Investing.com-- Most Asian currencies moved little on Wednesday as the dollar steadied with focus squarely on the upcoming presidential election and a string of key economic readings.

The Japanese yen also traded sideways after sinking to three-month lows, with focus turning to the conclusion of a Bank of Japan meeting on Thursday. 

Regional currencies were nursing steep losses in recent weeks as traders turned increasingly risk-averse in anticipation of a tight U.S. presidential race.

A string of key U.S. economic readings are also due this week, coming before a Federal Reserve meeting where the central bank is widely expected to cut rates by a smaller 25 basis points. 

The dollar index and dollar index futures steadied in Asian trade after hitting three-month highs earlier this week. 

Japanese yen fragile as BOJ meeting looms 

The Japanese yen was flat on Wednesday, with the USDJPY pair hovering around 153 yen after nearly reaching 154 yen in overnight trade. 

Weakness in the yen came before the conclusion of a BOJ meeting on Thursday, where the central bank is widely expected to leave rates unchanged.

Heightened political uncertainty in Japan is expected to cloud the BOJ’s plans to raise rates further after two hikes earlier this year. 

Japan’s ruling coalition, led by the Liberal Democratic Party, lost its parliamentary majority in a recent general election, presenting a fractured outlook for Japanese politics.

This uncertainty is expected to push the BOJ into adopting a more cautious approach towards higher rates, while the central bank is also expected to face increased political resistance towards increasing interest rates. 

The yen- which was already nursing losses through October- was battered further by this notion. 

Chinese yuan softens with PMIs, stimulus in focus 

The Chinese yuan weakened slightly on Wednesday, with the USDCNY pair rising 0.1% and remaining close to two-month highs.

Focus this week was on purchasing managers index data from the country, which comes at the heels of several new stimulus measures from Beijing that were rolled out through October. 

Focus is also on a meeting of China’s National People’s Congress in early-November, which is expected to offer more cues on the government’s plan to increase fiscal spending.

Broader Asian currencies moved in a flat-to-low range as traders remained broadly risk-averse. The Australian dollar’s AUDUSD pair fell 0.3% following mixed consumer inflation data that showed headline inflation fell in the third quarter, but underlying inflation remained sticky.

The South Korean won’s USDKRW pair was flat, while the Singapore dollar’s USDSGD pair rose 0.1%.

The Indian rupee’s USDINR pair was flat but remained close to record highs above 84 rupees.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.