Most emerging Asian currencies eased on Wednesday, hurt by a continuing rout in China's stock markets, while jitters grew before US inflation data and minutes of the Federal Reserve's last policy review are published. China shares dropped again, extending Tuesday's 6 percent loss, as investors dumped shares across the board amid deepening worries that the government could be phasing out its rescue efforts. The yuan also slid, while broadly flat official guidance checked its downside.
The Vietnamese dong fell on the unofficial market after the country devalued the currency for the third time this year to support exports. Malaysian's ringgit stayed around a pre-peg 17-year low in slow trade on weak commodity prices. The Thai baht hit a six-year trough as foreign investors on Tuesday reported their largest stock selling in more than 1-1/2 years after a bomb blast on Monday.
"Tumbling Chinese stocks, along with the Fed's rate increase expectations, could spur capital outflows further from emerging Asia amid growing concerns over sluggish economies," said Yuna Park, a currency and bond analyst at Dongbu Securities in Seoul. Investors were awaiting US July consumer inflation data and minutes of the Fed's July policy meeting to gauge if the US central bank will raise interest rates as soon as next month.
Crude prices resumed their slide, highlighting concerns over export performance. Malaysia is a major supplier of natural liquefied gas and palm oil. Malaysia's consumer prices rose 3.3 percent in July from a year earlier, faster than expected. Still, thin liquidity kept investors from taking fresh positions. A senior Malaysian bank trader said currency trading volume shrank to about 20 percent of past levels.
The selloff followed the explosion in Bangkok which killed 22 people, spurring fears the attack will hurt tourism, one of the few bright spots in the economy.