Most Asian currencies up

Most Asian currencies gained ground against the US dollar on Tuesday as global risk sentiment rose after world equities showed a semblance of calm, while the greenback was on the defensive on worries about its receding yield advantage.
Asian stocks rallied on Tuesday, tracking Wall Street's extended rebound from last week's steep fall, with MSCI's broadest index of Asia-Pacific shares outside Japan climbing 1.4 percent. "Equity markets have begun the week on a somewhat positive note, picking up from a Friday rebound as bargain hunters have returned on the first sign of stability," Stephen Innes, head of trading for Asia Pacific at Oanda said in a note.
Meanwhile, the dollar index dipped 0.2 percent, having fallen 0.26 percent on Monday. "The US dollar traded lower as currency traders are analysing the rebounding global equity markets," added Innes. Innes noted that the greenback has started the week with low trading momentum as investors are looking forward to US inflation data expected later in the week.
Higher inflation could trigger faster policy tightening by the US Federal Reserve. However, if the Fed doesn't act fast enough and falls behind the curve on policy, it could end up pushing up long-term bond yields. The Korean won strengthened 0.2 percent, in tandem with the KOSPI stock index which rose as much as 1.5 percent, its biggest intraday percentage gain in 18 weeks.
Across the East China Sea, Taiwan's dollar strengthened 0.1 percent. The Chinese yuan traded flat after the central bank lowered its official yuan midpoint to the weakest level in more than two weeks on Tuesday. Earlier in the day, the People's Bank of China said it injected 393 billion yuan ($62.14 billion) into the financial system via one-year medium-term lending facility (MLF) loans, with interest rates unchanged.
The Philippine peso was only regional currency to weaken and was on track to extend losses to a fourth consecutive session. The peso, one of the worst-performing Asian currencies of 2017 has been under pressure from a growing trade deficit. The Malaysian ringgit firmed slightly ahead of growth data due on Wednesday.
Malaysia's economy was seen likely to have grown more slowly in the last quarter of 2017 than the blistering pace set in July-September, a Reuters poll showed, as exports decelerated. "While March rate hike expectations are low due to the dovish inflation overtones expressed by Bank Negara Malaysia in January, but a notable above-consensus print on this week's GDP will increase the odds of a rate hike later in 2018 and strengthen the ringgit," said Oanda's Innes.
The Singapore dollar also strengthened slightly ahead of fourth-quarter GDP data due on Wednesday. The economy is forecast to have expanded less than initially expected in the last quarter of 2017 as factory activity and exports eased, suggesting the recent moderation in booming sales of electronics could be a drag on growth this year.
A Reuters poll on Monday predicted quarter-on-quarter growth at 2.0 percent in the October-December period on a seasonally adjusted and annualised basis, slowing from the 2.8 percent preliminary figure.
The Thai baht led the gains among regional currencies as it firmed 0.7 percent, its biggest intraday percentage gain in nearly three weeks. Thailand's central bank is expected to leave its policy rate unchanged on Wednesday, near record lows, as the economy gains traction but inflation and domestic demand stay soft.