Asian currencies decline on recession fears; key US, China data awaited

[superadmin]

BENGALURU (July 11): Most Asian currencies started the week on a subdued note on Monday (July 11), as concerns about the global economic outlook drove investors towards the safe-haven US dollar, ahead of key data by the United States and China this week.

China's yuan, the Singaporean dollar and South Korea's won declined between 0.1% and 0.2%, while the Indian rupee weakened to a fresh record low in the face of broad strength in the US dollar.

The greenback was perched near a 20-year peak, as a hawkish US Federal Reserve and the possibility of a global recession persuaded investors to switch to the safety of US bonds.

Stronger-than-expected US labour market data has bolstered expectations the Fed will deliver another 75-basis-point rate hike later this month, a move that could pile further pressure on beaten down Asian currencies.

"This week's focus pivots back to inflation, particularly the US CPI (consumer price index) and the inherent hawkish Fed policy implications," said Stephen Innes, managing partner at SPI Asset Management.

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