Asian currencies rose this week as US President Barack Obama’s re-election increased the likelihood that the US Federal Reserve will keep boosting the supply of US dollars that can be invested in emerging markets.
Global funds pumped a net US$256.5 million into Taiwanese and Philippine stocks this week, exchange data show, while buying US$71 million more Thai sovereign notes than they sold, Thai Bond Market Association figures show.
China’s yuan snapped a 13-week rally, its longest winning streak since March 2008, on speculation the nation will struggle to boost export growth as the “fiscal cliff” looms in the US and Europe’s debt crisis remains unresolved.
The New Taiwan dollar advanced 0.5 percent this week to NTS$29.150 against the greenback in Taipei, Bloomberg data showed.
Thailand’s baht, South Korea’s won and the Philippine peso gained 0.3 percent to 30.65, 1,087.85 and 41.052 respectively. The Bloomberg-JPMorgan Asia Dollar Index, which tracks the region’s 10 most active currencies excluding the yen, was unchanged.
The Philippine peso traded near a four-year high after the Southeast Asian nation raised the equivalent of US$750 million from a sale of 10-year global peso bonds.
The yuan traded little changed at 6.2450 per US dollar on Friday and touched the upper limit of its band for a fifth day. Consumer prices rose 1.7 percent last month from a year earlier, the least since January 2010, official data showed. The median estimate in a Bloomberg survey was 1.9 percent.
India’s rupee dropped 1.7 percent this week to 54.7550 per US dollar.
Elsewhere, Malaysia’s ringgit declined 0.3 percent this week to 3.0640 after the central bank kept its overnight policy rate on hold at 3 percent on Thursday, while Indonesia’s rupiah fell 0.1 percent to 9,620 and Vietnam’s dong held at 20,848.
In the EU, the euro slid the most in four months versus the yen on concern over the US fiscal cliff.
Japan’s yen rose against all of its 16 most traded peers as investors sought a haven amid a worsening global economic outlook.
The euro tumbled 2.1 percent to ￥101.05 in New York trading in its biggest weekly loss since July 6. It touched ￥100.43 on Friday, the weakest level since Oct. 11. The shared currency dropped 0.9 percent to US$1.2714 and reached US$1.2690, the lowest since Sept. 7. The yen rallied 1.2 percent to 79.49 per US dollar in its first weekly gain since Oct. 12.
The US dollar gained against the majority of its most traded counterparts amid concern that Obama will struggle to convince US Congress to avert automatic budget cuts and tax increases scheduled to take place at the end of the year. The US currency strengthened as investors bought US Treasuries, a traditional refuge.
The Dollar Index, which Intercontinental Exchange Inc uses to track the greenback against the currencies of six major US trading partners, gained 0.5 percent to 81.026, rising for a third week. The US dollar was the strongest net-purchased currency this week, Bank of New York Mellon client data showed.