The currencies of Indonesia and India fell on Tuesday, as the two countries face higher oil import bills due to global energy market developments, while most other regional ones eked out tiny gains. Oil prices rallied after the United States on Monday demanded that buyers of Iranian oil stop purchases by May 1 or face sanctions, ending six months of waivers that allowed Iran's eight biggest buyers to continue importing limited volumes.
The Indonesian rupiah and the Indian rupee led declines in the region, weakening between 0.1 percent and 0.2 percent, respectively.India's central bank will conduct its second dollar-rupee swap auction of $5 billion on Tuesday, following a round last month in a bid to boost liquidity and prevent a sharp appreciation in the rupee.
In Indonesia, Southeast Asia's largest economy, market focus will be on Thursday's central bank meeting, which is widely expected to keep rates on hold. Some analysts expect multiple rate cuts later this year. The Malaysian ringgit was marginally higher, ahead of March inflation data on Wednesday.
Malaysia's consumer prices are expected to edge up in March, following two months of deflation, according to a Reuters poll. The consumer price index turned negative in January for the first time since November 2009 amid a sharp drop in retail fuel costs. However, the central bank expects inflation to be higher on average this year after benign cost pressures in 2018.
The Malaysian central bank and securities commission said on Tuesday that the country's financial markets have remained resilient with support from ample domestic liquidity and strong fundamentals. The joint statement followed one last week's from FTSE Russell, a global bond index provider, that it could drop Malaysia from the FTSE World Government Bond Index over concerns about market accessibility and liquidity.
The Philippines suspended foreign exchange trading and a treasury bond auction on Tuesday due to the impact of Monday's 6.1 magnitude earthquake that hit the main island of Luzon, causing disruption in Manila and nearby provinces. The Philippine peso was flat in light offshore trading.
The Singapore dollar edged lower after data issued on Tuesday showed that core inflation in March was below expectations, easing to its lowest level in almost a year. "Given the fact that the Monetary Authority of Singapore has ended the tightening cycle, there is not a lot of expectations for change in monetary policy in the near to midterm," said Margaret Yang Yan, a market analyst at CMC Markets Singapore.
Earlier this month, Singapore revised down its 2019 core inflation and kept monetary settings unchanged after two consecutive rounds of tightening as policymakers expect slower growth and inflation in the city-state in the face of 'significant' global economic risks.