The dollar gained against most Asian currencies on Friday as a potential breakthrough in nuclear tensions between the United States and North Korea supported sentiment toward the greenback, while also supporting the South Korean won. Reports that US President Donald Trump has agreed to meet North Korean leader Kim Jong Un by May caused both the dollar and the South Korean currency to strengthen, shielding the Asian currency from weakness felt in the rest of the region.
Outside of geopolitical factors, US non-farm payroll data for February is likely to be a key driver for Federal Reserve rate hike expectations, which could give the dollar some direction.
"Barring any negative surprises in tonight's US monthly jobs data, the Fed is on track to hike rates at its next FOMC meeting on March 21," DBS Group strategists Eugene Leow and Philip Wee said in a note.
"The Fed is also expected to upgrade its assessment for the US economy/inflation." The dollar index against a basket of six major currencies was up to 0.15 percent higher at 90.31, the highest in more than a week.
The South Korean won firmed 0.22 percent against the dollar while the country's benchmark equities index gained up to 1.8 percent. A fortnightly poll of analysts by Reuters showed a doubling of bullish bets on the won.
The Indian rupee was 0.07 percent firmer and Thailand's baht was flat against the dollar. Thailand's central bank governor said on Thursday that its monetary policy needs to remain accommodative to aid the country's economic recovery as inflationary pressure remains soft.
The baht has been among the top gaining regional currencies in the year to date, leading to fears of lower Thai export competitiveness.
Indonesia's rupiah was 0.04 percent weaker while the Singapore dollar softened 0.08 percent. Similarly, Malaysia's ringgit lost 0.13 percent ahead of the payroll data while the Taiwan dollar weakened by 0.10 percent.
The yuan was 0.09 percent weaker against the dollar. The People's Bank of China set a weaker daily fixing for the first time since Monday, at 6.3451 per dollar. Trump on Thursday pressed ahead with the imposition of 25 percent tariffs on steel imports and 10 percent for aluminium, though he announced exemptions for Canada and Mexico, and said exceptions could also be made for other allies.
China, which produces half the world's steel, said it was "resolutely opposed" to his decision.
The Philippine peso was among the worst performers in the region as inflation and export data released this week took their toll on the currency.
Philippine exports grew at their slowest pace in more than a year in January keeping the country's trade deficit at a high level that could further weigh on the peso, which is languishing near a 12-year low.
DBS Bank's Wee said Asian currencies with both budget and current account deficits, including the Philippine peso, will be more vulnerable to higher US 10-year bond yields.
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