Physical Address
304 North Cardinal St.
Dorchester Center, MA 02124
Investing.com– Most Asian currencies fell on Tuesday and are headed for annual losses as the dollar remained strong into 2025 while China’s yuan weakened after data that the country’s factory activity expanded at a slower pace.
In Asian trade, it was 0.1% weaker but remained at a 2-year high touched earlier in the month. Also marked low.
The Federal Reserve’s interest rate outlook has weakened Asian currencies significantly this year and fears of a possible US-China trade war under the Donald Trump administration have eroded risk appetite.
In the year The Fed’s latest signal of tapering in 2025 has given renewed strength to the dollar and put downward pressure on Asian currencies.
China’s yuan slips as factory activity expands more slowly than expected
The Chinese yuan onshore pair rose 0.2 percent on Tuesday, while the onshore pair was little changed.
China expanded for a third consecutive month in December, data from the Purchasing Managers’ Index showed on Tuesday as new stimulus measures continued to support it. However, the increase was less than market expectations and below last month’s reading.
Markets are expecting more clarity on Beijing’s stimulus measures next year. Recent reports suggest that the country will increase fiscal spending to support economic growth.
Asian currencies are set for annual declines
The Japanese yen pair fell 0.3% on Tuesday after hitting a five-month high in the previous session. The yen is set to lose more than 10% against the US dollar for the year.
The Singapore dollar pair is largely unchanged but is headed for a year-on-year rise.
The Australian dollar fell slightly on Tuesday.
The Indian rupee pair rose 0.1%, and was on track to gain more than 3% this year. The rupee hit a new record low against the US dollar this month.
The Thai baht pair added 0.3% while the Indonesian rupiah pair gained 0.2% on Tuesday.
South Korea prevailed amid the worst political turmoil.
The South Korean pair gained 0.1% on Tuesday. The won weakened nearly 6% against the US dollar in December, following the failed imposition of martial law in the country.
The winner is the best-performing currency among its Asian peers, tracking a decline of more than 12 percent through 2024.
In recent updates, a South Korean court in It approved an arrest warrant on Tuesday for President Yoon Suk-yeol, who was impeached and ousted following a Dec. 3 decision to impose martial law.
Seoul’s Western District Court granted the warrant requested by investigators to limit Yoon’s brief martial law, according to the Corruption Investigation Bureau (CIO).
