Asia FX extends fallout from Trump tariff fears; ringgit jumps in BNM rate they hold bets By Investing.com
Investing.com – Most Asian stocks extended losses on Wednesday as investors remained cautious ahead of potential new US tariffs under the Donald Trump administration, while Malaysia’s ringgit jumped on expectations that the central bank will keep interest rates steady for a while.
The index is expected to hold rates steady at 3.00% for the 10th consecutive meeting on Wednesday due to strong economic growth and subdued inflation, a Reuters poll said.
The Malaysian ringgit jumped 0.6% against the US dollar, with the pair down to 4.4465 ringgit as of 03:07 GMT.
Most other regional currencies were under pressure as the dollar was slightly stronger in anticipation of higher US prices.
It rose 0.2% during Asian trading, after losing more than 1% earlier in the week. increased by 0.1%.
The Bank of Japan is expected to raise rates this week
The Japanese yen pair rose 0.2% ahead of the Bank of Japan’s (BoJ) two-day policy meeting starting on Thursday.
The BoJ is expected to hike on Friday. Reuters reported last week that the central bank is likely to reiterate its commitment to further rate hikes if the economy maintains its resilience.
“If the BoJ raises rates, we believe the market will grow to view further hikes as unlikely at least until after the July Upper House elections (our estimate is July),” Bank of America analysts said in a recent note.
The price scare continues under Trump 2.0
Trump said on Tuesday that he is considering imposing a 10% tariff on Chinese imports from February 1, as he has indicated that jobs may be increased in many major economies.
Regional funds have faced downward pressure, despite expectations that new rates will be introduced gradually. If hit to its full extent, these charges could have a major impact on many Asian currencies, given the region’s heavy dependence on trade with China.
The Chinese yuan onshore pair rose 0.3%, while the onshore pair was largely unchanged on Wednesday.
The Australian dollar pair was down 0.2%.
The Singapore dollar pair rose 0.3%, while the Indian rupee pair rose 0.1%.
The South Korean won pair rose 0.4%. South Korea is in the midst of a trial against President Yoon Suk Yeol over his attempts to impose martial law in the country.
Elsewhere, the Taiwan dollar rose 0.5%, while the Philippine peso gained 0.4%.
