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Asian currencies subdued, Yen sticks to lows

7/11/2017, 2:41:16 PMTrading Strategies
Asian currencies subdued, Yen sticks to lows

The yen seesawed in a narrow band on Tuesday morning in Asia, a day after hitting four month lows against the USD, with most Asian currencies remaining subdued.

The yen at 114.20 by mid-morning, gaining some lost ground, with a weakening in machine order and soft current account figures weighing on investors.

In China, the yuan remained flat, with the People's Bank of China setting the reference rate around which the yuan is allowed to trade at 6.8045, giving up 0.04% against the USD.

The South Korean won was down 0.09% in early morning trade to 1150.500 to the USD.

The U.S. dollar index, which measures the greenbackís strength against a trade-weighted basket of six major currencies, was up 0.06% to 95.87 at mid-morning in Asia. The dollar rose against a basket of the other major currencies on Friday after data showing that the U.S. economy created jobs at a robust pace last month supported expectations for a third hike by the Federal Reserve this year. The U.S. economy added 222,000 jobs last month the Labor Department reported, more than expected. The rapid pace of jobs growth reassured investors that the economy is on a strong enough footing to justify the Fedís plans to raise interest rates once more this year.

Investors are now looking towards Fed Chair Janet Yellen's testimony on monetary policy as well as U.S. data on inflation and retail sales, both of which are due out on Friday, and trade data from China on Thursday. The Fed hiked rates at its June meeting and stuck to its forecast for one more rate hike this year, but a subdued inflation outlook has cast doubts on whether it will follow through.