Emerging Asian currencies rose on Tuesday, with the Malaysian ringgit and Taiwan dollar climbing to near six-month highs, as investors sold the US dollar in an absence of clear signs of de-escalation in global trade tensions.
Malaysia’s currency, which has gained over 3% this year, rose 0.6% to hit its highest level since late October, while the Taiwan dollar added 0.6% and was at its highest since November last year.
Malaysia’s producer price index (PPI) fell by 1.9% in March after a 0.3% gain in the prior month, putting further pressure on the local central bank to lower interest rates in its upcoming policy meeting.
The US dollar struggled to recover from its steep losses and was last inching lower as investors continued to be confounded by shifting US trade policies.
Ringgit, rupiah lead Asian currencies higher
Adding to the confusion, Treasury Secretary Scott Bessent said in an interview that it was up to China to take steps to de-escalate tariffs.
Market participants will also be watchful of global factory activity reports and a raft of economic data scheduled this week, including US employment, gross domestic product and core inflation that may give a first glimpse of whether Trump’s trade war is hitting home.
“The markets biggest concern is determining the fair price for the US Dollar. The drop in the US Dollar last night comes as markets position for a deluge of data at the end of the week,” said Kyle Rodda, senior financial market analyst at Capital.com.
Among other emerging Asia currencies, the Philippine peso , Thai baht and Singapore dollar were mostly trading upbeat.
The Bank of Thailand (BOT) is set to meet on Wednesday for its monetary policy meeting, where it is expected to deliver a quarter percentage point rate cut to support slowing growth in the country.
Equity markets in Asia were higher after investors retreated from safe-haven assets like bullion and the US dollar.
Shares in Singapore and Taiwan added 0.2% and 0.6%, while those in India and Jakarta gained 0.2% and 0.5%, respectively.
The island-country of Singapore is set to head to the polls on Saturday, with investors focused on assurances of policy continuity in the financial centre.
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