Asian currencies steady as yen stays near the 160 level

The yen’s USD/JPY pair was near 159.81, after the yen weakened past 160 in each of the previous two sessions

The yen steadied near the closely watched 160-per-dollar level on Tuesday with most other currencies trading in a tight range, while renewed Iran-U.S. fighting pushed oil above $91.

The yen’s USD/JPY pair was near 159.81, after the yen weakened past 160 in each of the previous two sessions.

The level has again become a major focus for currency markets because the yen has surrendered more than half the gains from a record bout of intervention that began in late July. The intervention by authorities provided only short-lived relief, leaving investors watching closely for signs that authorities could step in again to slow the yen’s decline.

The renewed geopolitical tensions are adding another layer of uncertainty. Brent crude gained 0.7% to around $91.10 a barrel after Iran and U.S. exchanged direct strikes for the first time in about a month.

Yuan was little changed after the private RatingDog China General Manufacturing PMI rose to 51.5 in August from 50.9, beating the 51 forecast.

The yuan’s USD/CNH pair and the USD/CNY pair rose to 6.72, each. The muted moves came despite the stronger private survey, which contrasted with Monday’s official manufacturing PMI of 49.8, up from 49.2 but still below the 50 threshold.

The Indian rupee firmed, with the USD/INR pair dropping 0.21% to 94.964. India’s economy grew 7.8% year-on-year in April-June, above DBS’s 7.5% forecast but below revised 8.6% growth in the previous quarter.

DBS said the rupee finished Monday at a four-week high near the low-95 handle, helped by expected inflows from MSCI rebalancing, and saw 96.00 as near-term resistance amid intervention risks. The Reserve Bank of India was also likely to have intervened before Tuesday’s open.

The won’s USD/KRW pair advanced 0.4% to 1,372.69, while the Singapore dollar’s USD/SGD pair rose marginally to 1.2718. The Australian dollar’s USD/AUD pair edged down 0.03% to 1.3950, while the New Zealand dollar dropped to $0.5908.