Asian currencies fell this week by the most in more than a month as worse-than-projected data from the US heightened concern the global recovery was stalling, dampening the outlook for the region’s exports.
India’s rupee reached a four-month low on Thursday, while Indonesia’s rupiah closed at the weakest level in almost two years. Reports this week showed the euro-area jobless rate rose to 10.9 percent in March, the highest since April 1997, and the services industry in the US grew slower than economists predicted last month as consumer confidence waned.
“The currency market is driven by data which has been mixed and not pointing to a sharp recovery,” said Jackit Wong, a regional economist at Natixis Asia in Hong Kong. “It will disappoint people looking to the US to compensate for a recession in Europe or a slowdown in China.”
The rupee slumped 1.6 percent this week to 53.415 per US dollar, according to data compiled by Bloomberg. The Thai baht lost 0.6 percent to 30.96 and the rupiah dropped 0.4 percent to 9,220.
The Bloomberg-JPMorgan Asia Dollar Index fell 0.21 percent this week, the most since a 0.33 percent drop in the period ended March 23. Its 60-day historical volatility declined to 2.73 percent from 2.79 percent on April 27.
The Chinese yuan advanced 0.1 percent to 6.3040 per US dollar from a week ago, as the US and China held an economic dialogue in Beijing.
“It’s almost like a habit for China to ease tensions at high-level meetings with the US by strengthening the yuan,” said Kenix Lai, a Hong Kong-based currency analyst at Bank of East Asia. “The trade surplus estimate is a surprise to the market, providing some short-term upside to yuan.”
The New Taiwan dollar strengthened 0.3 percent this week to NT$29.238 against its US counterpart, and the Philippine peso climbed 0.4 percent to 42.22.
The South Korean won fell 0.2 percent on Friday to 1,131.45 per US dollar in Seoul, trimming this week’s advance to 0.3 percent.
The euro slid versus the US dollar by the most in almost a month and reached an 11-week low against the yen after further slowing in the region’s economies and before national elections that may result in leadership changes.
The yen rose versus all of its 16 most-traded peers, gaining for a second week versus the greenback, as a smaller-than-forecast payrolls gain in the US and recessions in the UK and Spain increased demand for safe-haven assets.
“There’s [sic] mounting signs of sluggish global growth, and as a result we’re seeing a lot of these growth currencies suffer the biggest losses this week,” said Joe Manimbo, a market analyst in Washington at Western Union Business Solutions, a unit of Western Union Co. “If we continue to see political uncertainties in Europe linger, that’s something that could cap the euro’s upside.”
The euro dropped 1.3 percent to US$1.3084 on Friday in New York, from US$1.3255 a week earlier. It was the biggest loss since the five days ended April 6. The 17-nation currency fell 1.8 percent to ￥104.49 and reached ￥104.40, the weakest level since Feb. 17. Japan’s currency gained 0.5 percent to ￥79.85 per US dollar.
The yen rose on Friday as government data showed US nonfarm payrolls added 115,000 jobs, after a revised increase of 154,000 in March.
“The headline employment report wasn’t great, but I don’t think it’s going to change the foreign-exchange market’s very narrow ranges,” said Alan Ruskin, global head of G10 currency strategy at Deutsche Bank AG in New York. “It does seem like the US economy slowed down a bit from the winter, but it’s not to the point where it’s necessarily going to change key variables like whether the Fed is going to change policies.”