Asian Currencies Climb as US Dollar Falls
Asian currencies are doing better, with the US dollar reaching a low not seen in six weeks. This is because recent reports show that America’s slow job growth and the US Federal Reserve might stop increasing interest rates.
Important Economic Updates Ahead
Everyone is now looking at new economic information from China and what the Reserve Bank of Australia will decide. These will tell us more about how economies in Asia are doing. People feel good about investing after discovering that the US added fewer jobs than expected last month. This slowdown in job growth could mean the US Federal Reserve won’t raise interest rates again.
Investors are starting to put their money into Asian markets, which are usually seen as riskier. The Korean won, and the Thai baht went up a little. The biggest winner was the Malaysian ringgit, which went up the most among the Southeast Asian currencies.
Japanese Yen’s Standing
The Japanese yen dropped slightly, staying below 150 against the dollar. This is even though Japan’s service sector did better than people thought it would in October. Still, the yen might not do well because the Bank of Japan wants to keep its policies very loose, and the bank’s boss said they’re not changing this approach anytime soon.
Dollar Weakness and What the Fed Might Do Next
After dropping to a low last seen in late September, Asia’s dollar got a bit better. Investors don’t think the US Federal Reserve will raise rates anymore this year. The pause in rate hikes is suitable for Asian currencies, but the Fed is expected to keep rates up for a while, which could slow down the growth of these currencies.
Yuan and Aussie Dollar Get Stronger
The Chinese yuan got a bit better, helped by the dollar’s weakness and China’s central bank setting a reasonable rate. People are waiting for China’s trade and inflation numbers, which will give us a clearer picture of how China’s economy is doing. The Australian dollar is also strong, with everyone thinking the Australian central bank will raise rates because of higher prices and strong store sales. The bank has stopped growing rates since May, but they might increase them again if prices keep rising.