(Adds text, updates prices)
* Asian currencies steady to lower versus dollar
* Focus on Fed’s policy meeting starting on Tuesday
By Masayuki Kitano
SINGAPORE, March 15 (Reuters) – Asian currencies were steady
to lower against the dollar on Tuesday, as investors awaited
clues on the U.S. monetary policy outlook from the Federal
Reserve’s two-day policy meeting starting later in the day.
Emerging Asian currencies have rallied this month as
improving U.S. economic data plus a recovery in oil prices that
has helped reduce concerns about the outlook for global growth
and spurred buying of risk assets.
Analysts, however, say Asian currencies could fall against
the dollar in the near term if market expectations for the Fed
to raise interest rates in the next few months were to increase.
The Fed’s policy-setting Federal Open Market Committee
(FOMC) holds a two-day meeting starting on Tuesday and is widely
expected to keep interest rates unchanged.
The focus is whether the post-meeting statement and comments
by Fed Chair Janet Yellen will lead to any increase in bets for
the Fed to raise interest rates by mid-year, following a recent
improvement in U.S. economic data.
“The recent rally in Asian currencies was due partly to the
market’s lower expectations of U.S. Fed rate hikes in the
foreseeable future,” said Alvin Liew, senior economist at UOB.
“The Fed may issue some hawkish signals to keep the
potential rate hike decision alive in the April and June FOMC
meetings, which may be enough to send the U.S. dollar higher
against Asian currencies later this week,” Liew said.
THAI BAHT
The baht held steady versus the dollar, staying near a high
of 35.035 set against the dollar on Monday, its
strongest level since August 2015.
The baht’s recent rise has been accompanied by signs of
inflows into Thai assets.
Net foreign buying of Thai bonds totalled 44.5 billion baht
between March 1 to March 11, according to data from the Thai
Bond Market Association.
INDONESIAN RUPIAH
A key event for the rupiah this week is an interest rate
decision by Indonesia’s central bank on Thursday.
Analysts are almost evenly split on whether Indonesia’s
central bank on Thursday will cut its key interest rate for a
third time this year, a Reuters poll showed.
Thirteen of 22 analysts in the poll said Bank Indonesia (BI)
will trim the benchmark rate by another 25 basis points
to 6.75 percent. BI cut the rate by that amount at policy
meetings in January and February.
CURRENCIES VS U.S. DOLLAR
Change on the day at 0601 GMT
Currency Latest bid Previous day Pct Move
Japan yen 113.35 113.81 +0.41
Sing dlr 1.3769 1.3764 -0.04
Taiwan dlr 32.792 32.870 +0.24
Korean won 1186.49 1186.10 -0.03
Baht 35.09 35.08 -0.03
Peso 46.75 46.60 -0.33
Rupiah 13085.00 13055.00 -0.23
Rupee 67.22 67.14 -0.12
Ringgit 4.1155 4.1040 -0.28
Yuan 6.5067 6.5015 -0.08
Change so far
in 2016
Currency Latest bid End prev year Pct Move
Japan yen 113.35 120.30 +6.13
Sing dlr 1.3769 1.4177 +2.96
Taiwan dlr 32.792 33.066 +0.84
Korean won 1186.49 1172.50 -1.18
Baht 35.09 36.00 +2.60
Peso 46.75 47.06 +0.66
Rupiah 13085.00 13785.00 +5.35
Rupee 67.22 66.15 -1.59
Ringgit 4.1155 4.2935 +4.33
Yuan 6.5067 6.4936 -0.20
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(Reporting by Masayuki Kitano; Editing by SImon Cameron-Moore)
