Asia FX retreats

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    Most Asian currencies pulled back on Thursday as fresh worries about Sino-US trade negotiations as well as widening diplomatic rifts between Washington and its major trading partners sapped appetite for units in the region.

    Reports that the US President would sign a bill to support Hong Kong protesters caused concerns that US human rights concerns would bleed into trade talks with Beijing.

    That combined with reports that an interim trade deal between the world’s two largest economies could be delayed to 2020.

    The broadening fears about trade were compounded by poor export data from Asian exporting nations, with the South Korean won leading regional losses and safe-havens such as the US dollar and the Japanese yen finding support.

    “Asia has been nervous about the state of trade play all week with equities ex-China underperforming,” said Jeffrey Halley, Senior Market Analyst, Asia Pacific, OANDA, in a note. “The early price action this morning suggests that the cautious walk to the exit may be turning into an unruly every man for himself.”

    The Indonesian rupiah touched its weakest level in one month to the dollar, ahead of a central bank rate decision expected later in the day.

    The bank is widely expected to stand pat on its benchmark rate, having trimmed policy for the four prior months to boost Southeast Asia’s largest economy.

    “We expect Bank Indonesia to pause and wait for impact from previous cuts to gradually materialize before easing further, if necessary,” said Mizuho’s Zhu Huani, in a note to clients.

    The Thai baht dipped 0.07 percent to the dollar after data showed exports dropped more than expected in October, due to an overly strong baht.

    The Singapore dollar trended slightly lower as the weak risk appetite was somewhat mitigated by faster-than- initially-estimated third-quarter GDP growth.

    The South Korean won was in particular focus due to dismal trade data and reports of the United States withdrawing troops from the country.

    The currency lost up to 0.76 percent against the dollar, touching its weakest level in one month.

    Exports fell 9.6 percent in the first 20 days of November from a year earlier, as trade ructions continued to chip away at demand for its electronics goods. – Reuters