Asian forex: Export-dependent units take comfort

Currencies of export-focused Asian countries notched gains against the dollar on Wednesday, as a slowdown in the pace of new coronavirus infections fuelled hopes that the worst of the epidemic might be over.

China on Wednesday reported its lowest number of new coronavirus cases since late January, lending credence to a prediction from the country's senior medical adviser that the outbreak could be over by April.

An uptick in US yields, as bond prices fell, and the accompanying rise in global equities suggested a slow return to higher investor risk appetites, with the dollar losing ground against Asian currencies.

"It is important that we see containment efforts materialising into actual containment of the virus - new cases continue to slow, while recovery rises and outside-China spread is contained," Christopher Wong, a senior FX strategist at Maybank Singapore said.

The Thai baht strengthened 0.5% to 31.11 against the greenback, while the Chinese yuan edged up.

The baht is the worst performing emerging Asian currency this year - a reversal from its position as Asia's best performing currency last year and in 2018 - as the virus outbreak hurts Thailand's lucrative tourism sector.

The South Korean won advanced 0.3%, while the Taiwan dollar also gained 0.3% to its strongest level in more than three weeks.

The Malaysian ringgit erased early gains to edge down 0.1%.

Malaysia's central bank said on Wednesday there was "ample room" for a rate cut after economic growth slowed to the weakest in a decade in the fourth quarter and the coronavirus outbreak threatened to pile more pressure this year.

The Indian rupee inched lower, ahead of the release of inflation data later in the day. Inflation is expected to rise to a near six-year peak in January as food prices stayed high, according to a Reuters poll.

The Indonesian rupiah traded little changed, while the Philippine peso dipped slightly.