Investing.com — Most Asian currencies moved in a flat-to-low range on Wednesday as traders hunkered down before a slew of economic cues and central bank meetings in the coming weeks, while the dollar steadied after rising sharply overnight.
Fears of a U.S. economic slowdown, following a string of weak corporate earnings and softer-than-expected data, fed safe haven demand for the dollar and kept appetite for most risk-driven assets limited this week.
This saw the and jump over 0.5% each on Tuesday, even as U.S. Treasury yields fell and investors grew uncertain over more interest rate hikes by the Federal Reserve.
The central bank is expected to next week, after which markets are pricing in . But the Fed has given no indication that it intends to taper its hawkish stance, with several officials recently calling for higher interest rates.
The prospect of higher U.S. interest rates, despite slowing economic growth, weighed on most Asian currencies, especially as the gap between risky and low-risk yields narrows.
Safe haven demand spilled over into Asian currencies, with the up 0.1% after advancing 0.4% in overnight trade. Gains in the yen came even as new Bank of Japan Governor Kazuo Ueda signaled that the bank’s ultra-dovish stance will continue in the near-term.
Focus is now on and a on Friday for more cues on the Japanese economy.
rose 0.1% but closed in on the 7 level against the dollar, as continued concerns over an uneven economic recovery in the country fueled steep losses in the yuan this week. Data on is due on Thursday and is expected to shed more light on the country’s laggard manufacturing sector.
The was among the few outliers for the day, up 0.4% as data showed that the country logged an unexpected in March. shrank less than expected, while fell much more than forecast.
The also advanced 0.1% as data showed improved in March from the prior month.
The fell 0.3% as data showed that continued to ease in the country, albeit at a slower-than-expected rate. The mixed reading ramped up uncertainty over the Reserve Bank’s plans for interest rates, ahead of a .
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