Investing.com – Most Asian currencies extended losses on Wednesday as investors remained cautious ahead of new US tariffs under the Donald Trump administration, while the Malaysian ringgit jumped on expectations that the central bank would keep interest rates steady. later in the day.
This is expected to hold rates steady at 3.00% for the 10th straight meeting on Wednesday due to strong economic growth and control of inflation, a Reuters poll showed.
The Malaysian ringgit jumped 0.6% against the US dollar, with the pair falling to 4.4465 ringgit as of 03:07 GMT.
Most other regional currencies were under pressure as the dollar was slightly stronger in anticipation of additional US tariffs.
It rose 0.2% during Asian trade, after losing more than 1% at the start of the week. 0.1% higher than normal.
The Bank of Japan was expected to raise rates this week
The Japanese yen pair entered 0.2% higher ahead of the two-day Bank of Japan (BoJ) policy meeting that started on Thursday.
The BoJ is widely expected to raise on Friday. Reuters reported last week that the central bank is likely to reiterate its commitment to further rate hikes if the economy continues to recover.
“If the BoJ raises rates, we think the market will see another hike as unlikely at least until after the Upper House elections in July (our estimate is July),” said -analysis of Bank of America in a recent note.
The fear of tariffs remains under Trump 2.0
Trump said on Tuesday that he is considering imposing 10% tariffs on Chinese imports from February 1, as he raised the possibility of more duties on several major economies.
Regional currencies were under pressure, despite expectations that new tariffs would be phased in. If implemented at the full level, these tariffs could have a significant impact on most Asian currencies, as the region is heavily dependent on trade with China.
The Chinese yuan offshore pair rose 0.3%, while the onshore pair was largely unchanged on Wednesday.
The Australian dollar pair edged 0.2% lower.
The Singapore dollar pair rose 0.3%, while the Indian rupee pair edged up 0.1% higher.
The South Korean pair of winners rose 0.4%. South Korea is in the middle of the impeachment hearing of President Yoon Suk Yeol over his attempt to impose martial law in the country.
Elsewhere, the Taiwanese dollar pair climbed 0.5%, and the Philippines peso gained 0.4%.
