Investing.com-- Most Asian currencies moved little on Thursday after clocking steep losses in the prior session, while the dollar fell slightly from a one-month high as strong U.S. retail sales data spurred more doubts over early rate cuts by the Federal Reserve.
Sentiment towards Asian markets remained weak following softer-than-expected Chinese gross domestic product data, which showed the region’s largest economy struggling with a sluggish post-COVID recovery.
The Chinese yuan was flat after sinking to its lowest level in nearly two months. But further losses in the currency were limited by a stronger-than-expected midpoint fix by the People’s Bank of China.
Still, the outlook for the yuan remained dour, as the PBOC grappled with sluggish growth and limited headroom to keep supporting the currency.
Concerns over China weighed on most Asian currencies, given the country’s dominance as a trading hub for the region.
The Australian dollar rose 0.3% on Thursday after sinking to an over one-month low in the prior session.
Labor data showed Australian employment unexpectedly fell in December, although the broader labor market still remained relatively tight.
The Singapore dollar — which also has major trade exposure to China- rose slightly after hitting a two-month low on Wednesday, while the Taiwan dollar steadied near a two-month low.
The Japanese yen steadied at a 1-½ month low ahead of key consumer price index (CPI) data due on Friday, which is expected to show a sustained decline in inflation. The reading is expected to provide the Bank of Japan with little impetus to begin tightening its ultra-loose policy, which bodes poorly for the yen.
The yen was among the worst-performing Asian currencies in 2023, with a widening
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