Asia FX extends losing streak on Trump tariff fears; BoJ rate decision focused on Investing.com
Investing.com – Most Asian currencies fell on Thursday, extending their gains slightly amid concerns over new U.S. tariffs under the Donald Trump administration, while the focus was on the Bank of Japan’s policy meeting starting later in the day.
The BoJ is expected to rise at the end of its two-day meeting on Friday.
Analysts believe that inflation and recent wage data have been encouraging and support the central bank’s decision to raise interest rates.
Media reports have indicated that the BoJ will raise interest rates at its meeting if the economy maintains its stability.
The Japanese yen was largely muted ahead of the rate decision.
Asia FX eases US tax worries
Other regional currencies were under pressure in anticipation of additional US tariffs.
After his inauguration on Monday, Trump signed plans to impose a 10% tariff on Chinese imports from February 1, and warned of possible tariffs from the European Union.
Regional finances have faced downward pressure. 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 onshore Chinese yuan pair rose 0.1%, while the offshore pair was unchanged.
The Malaysian ringgit pair rose 0.2%, a day after Bank Negara Malaysia held its 10th consecutive meeting.
The pair of Australian dollar and Singapore dollar are both very muted.
The pair of Indonesian rupiah and Indian rupee, decreased by 0.1%, each.
South Korea’s win pair has been relatively high amid the ongoing political crisis in the country.
The US dollar is facing headwinds from the gradual introduction of tariffs
The dollar faced pressure as investors assessed the economic consequences of Trump’s gradual implementation of tariffs.
The greenback fell more than 1% earlier in the week after Trump avoided tax details, indicating they could come at a slower pace.
This was largely muted during Asian trade, after commenting higher the previous day. increased by 0.1%.
“Markets continued to bear down on the USD long term as the US Treasury had another tight session, and delayed tax announcements boosted optimism,” ING analysts said in a recent note.
