BY ANKUR BANERJEE
SINGAPORE — Global stocks held tight ranges on Tuesday and the dollar clawed back some of its recent losses against Asian counterparts as investors revived concerns about US tariffs and their impact on economic growth.
Those worries coupled with pledges from key oil producers to boost supply also kept crude prices languishing near four-year lows.
The focus in Asia has shifted to currencies following the Taiwan dollar’s surge in recent sessions, which has stoked speculation that a revaluation of regional foreign exchange was on the cards to win US trade concessions.
Its rally suggested a big unwinding is under way and shines a light on one economy among many where years of big trade surpluses have built up large long dollar positions at exporters and insurers that are now under question and on edge.
The heat turned to Hong Kong on Tuesday, where the de facto central bank bought $7.8 billion to stop the local currency from strengthening and breaking its peg to the greenback.
“The real action today is in Asian FX,” said Charu Chanana, chief investment strategist at Saxo in Singapore.
“If these currencies keep strengthening sharply, it could spark fears of a ‘reverse Asian currency crisis’, with potential ripple effects in the bond market amid fears that Asian institutions reassess their unhedged exposure to Treasury holdings.”
On the mainland, China’s yuan strengthened to its highest level since March 20 at 7.23 per dollar.
The Taiwan dollar was last at 30 per US dollar in early trading on Tuesday, not far from the near three-year high of 29.59 it touched on Monday as it jumped 8 percent over two days.
