Views Article – Sharenet Wealth

Asia, Forex

Most Asian currencies tread a narrow path; ECB in focus

* N. Korean missiles underpin won’s weakness * Philippine peso gains the most for the day * Global markets await ECB chief’s comments (Adds text, updates prices) By Aby Jose Koilparambil July 25 (Reuters) – Most Asian currencies traded inside a tight range ahead of the European Central Bank (ECB) meeting on Thursday, while appetites for riskier assets were dented by North Korea’s firing of two short-range missiles. Financial markets are keenly awaiting the ECB’s policy decision and assessment of the global economic health, possibly throwing the door open for monetary easing. Sim Moh Siong, foreign exchange strategist at Bank of Singapore, said ECB President Mario Draghi’s remarks will be Thursday’s “highlight” for forex markets. “After the weak Eurozone manufacturing data yesterday, there is a thinking that the ECB could possibly move ahead with the rate cut than waiting for September,” Sim said. “I think this is the meeting where they could signal rather than act and prepare for action in the September meeting.” The Indonesian rupiah, which weakened the past three sessions, rose as much as 0.1%, as did the Taiwan dollar . The Indian rupee, Thai baht and Malaysian ringgit barely changed. The South Korean won weakened as much as 0.2% after the country’s military said that North Korea fired two short-range missiles early on Thursday from its east coast, raising the temperature on the political front. It is the first missile test since North Korean leader Kim Jong Un and U.S. President Donald Trump agreed to revive stalled denuclearisation talks. The won is also the worst performing Asian currency this year, having shed about 5.4%. PESO GAINS The Philippine peso tacked on up to 0.2%, making it the region’s best gainer for the day. Last week, the Philippines revised its foreign exchange assumptions for its medium-term macroeconomic targets as it expects the peso to appreciate against the dollar on positive investor sentiment. Bank of Singapore’s Sim attributed strengthening in the peso over the past two sessions to how the country’s environment for growth is relatively better than those of peers in the region. CURRENCIES VS U.S. DOLLAR Change on the day at 0428 GMT Currency Latest bid Previous day Pct Move Japan yen 108.150 108.17 +0.02 Sing dlr 1.364 1.3643 -0.01 Taiwan dlr 31.068 31.084 +0.05 Korean won 1179.600 1177.9 -0.14 Baht 30.885 30.8825 -0.01 Peso 51.080 51.17 +0.18 Rupiah 13980.000 13990 +0.07 Rupee 68.963 68.98 +0.02 Ringgit 4.117 4.117 +0.00 Yuan 6.876 6.8730 -0.04 Change so far in 2019 Currency Latest bid End 2018 Pct Move Japan yen 108.150 109.56 +1.30 Sing dlr 1.364 1.3627 -0.12 Taiwan dlr 31.068 30.733 -1.08 Korean won 1179.600 1115.70 -5.42 Baht 30.885 32.55 +5.39 Peso 51.080 52.47 +2.72 Rupiah 13980.000 14375 +2.83 Rupee 68.963 69.77 +1.17 Ringgit 4.117 4.1300 +0.32 Yuan 6.876 6.8730 -0.04 (Reporting by Aby Jose Koilparambil in Bengaluru; Editing by Richard Borsuk)

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