Precise Investors Editorial Team
Asian currencies moved in a tight range, but were sitting on some gains over the past week
Most Asian currencies kept to a tight range on Tuesday. The Indian rupee was a laggard performer, hitting its weakest ever level against the dollar as benign inflation fuelled bets on more interest rate cuts by the Reserve Bank of India.
Focus this week is also on a Bank of Japan meeting, with markets bracing for a potential rate hike after sticky inflation and weakness in the yen spurred hawkish signals from the central bank.
Broader risk appetite also remained on the backfoot amid a prolonged downturn in global stock markets.
Broader Asian currencies moved in a tight range, but were sitting on some gains over the past week.
The Indian rupee was an exception, with the USD/INR pair gaining 0.2% to a record high of 91.083 rupees– the rupee’s weakest ever level against the dollar.
The Indian currency marked an extended decline since last week following weak CPI inflation readings, which reinforced bets on more easing by the RBI.
Other Asian currencies also dithered. The yuan’s USD/CNY pair dropped less than 0.1%, while the Singapore dollar’s USD/SGD pair gained 0.1%.
The Australian dollar’s AUD/USD pair shed 0.1%, although the currency gained ground in recent sessions amid speculation that the Reserve Bank of Australia may hike interest rates next year, due to sticky inflation.
The yen’s USD/JPY pair declined 0.2% to a 11-day low, as investors braced for hawkish signals from the BOJ. The central bank had recently signalled it will consider raising interest rates in December, amid increasingly sticky inflation.
Japanese CPI inflation data is also due before the BOJ’s decision on Friday.
The won’s USD/KRW pair added 0.4%, pressured by sustained capital outflows in stock markets, while the Taiwan dollar’s USD/TWD pair soared 0.5% on a similar trend.
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