SINGAPORE: Most emerging Asian currencies rose on Wednesday, helped by the yen's strength, while gains were limited by rising risk of deflation in the world's second-largest economy.
China's consumer inflation in November hit a five-year low, signalling persistent weakness in the economy and raising the prospect of more stimulus to support growth.
South Korea's won hit a near two-week high against the dollar as the firm yen eased concerns that the country may lose export competitiveness to Japan.
The yen advanced as global growth concerns and political uncertainty in Greece dented risk appetite.
Its appreciation helped regional currencies reverse earlier losses stemmed from increasing concerns over China.
"China slowdown is already priced in and some stimulus would help Asia FX," said Saktiandi Supaat, head of FX research at Maybank in Singapore.
"Unwinding of dollar positions from the recent risk-off could see some retracement in dollar/Asians.
WON
The won rose as much as 0.5 percent to 1,101.8 per dollar, its strongest since Nov. 28, tracking the yen's strength.
Traders remained cautious over possible intervention by the foreign exchange authorities around 1,100 to stem the South Korean currency's appreciation.
Against the yen, the won eased 0.6 percent to 9.2763.
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