Investing.com-- Most Asian currencies kept to a tight range on Wednesday, while the dollar steadied near six-week highs as markets awaited more cues on when the Federal Reserve could begin trimming interest rates.
The Japanese yen was an outlier for the day, rising 0.3% after Bank of Japan Governor Kazuo Ueda offered more signals on a potential end to the bank’s ultra-dovish policies. But Ueda gave no clear cues on when the BOJ will pivot away from negative rates, and said that easy monetary policy will remain for the near-term.
The yen was also aided by stronger-than-expected trade data for December, with Japanese exports to China rising for the first time in 13 months.
But purchasing managers index (PMI) data for January showed a sustained decline in Japanese manufacturing activity, while services activity grew further in December.
Broader Asian currencies kept to a tight range amid persistent concerns over higher-for-longer U.S. rates. Most regional units had clocked steep losses over the past week as traders began pricing out bets on a March 2024 rate cut.
China’s yuan traded sideways, but saw some strength this week after Bloomberg reported that the Chinese government was planning a massive 2 trillion yuan ($278 billion) support package for local stock markets.
The report fueled optimism that the government will roll out more support for the economy. But broader sentiment towards China remained muted amid persistent concerns over a sluggish post-COVID economic recovery.
Concerns over China kept most Asian currencies under pressure, particularly those with trade exposure to the country.
The Australian dollar fell 0.1%, even as PMI data for January showing some improvement in manufacturing and services activity. The
Read more on investing.com