Volatility in emerging market currencies will not let up in the next six months as U.S. presidential election jitters mount and domestic economic growth tapers off, a Reuters poll of market strategists showed.

Most emerging market currencies were forecast to weaken or at best cling to a range over the next three to six months but will rise about 2% on average in a year, supported by a weaker dollar, the Sept. 28-Oct. 5 poll found.

Reuters surveys since the global shutdown in activity in March have been consistently concluding emerging market currencies will not recoup even half their coronavirus-induced 2020 losses within a year.


Still, a steep dollar selloff, which just posted its worst quarter in three years as expectations for a swift recovery from the

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(Bloomberg) — Counting on China as an anchor of strength has been a good tactic for traders of Asia’s emerging currencies. That link is losing traction as recovery paths from the coronavirus pandemic diverge.

While China’s economy has bounced back from the Covid-19 crisis, as shown by data such as retail sales and industrial production, countries including Indonesia and the Philippines are still grappling with rising outbreaks. The 30-day correlation between the offshore yuan and six regional counterparts has declined in the past week as the Chinese currency climbed to the strongest level in more than a year.

a group of people walking on a sidewalk: Retail Economy as China's Recovery Picks Up Speed on Rebound in Retail Sales

© Bloomberg
Retail Economy as China’s Recovery Picks Up Speed on Rebound in Retail Sales

People walk past stores at a shopping area in Beijing on Sept. 20.


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Photographer: Yan Cong/Bloomberg

Asia’s two-speed recovery is making it difficult to predict the fortunes of the region’s exchange rates amid mounting headwinds

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By Swati Pandey

SYDNEY, Sept 21 (Reuters)Asian shares held to tight ranges on Monday, as did currencies, as investors awaited developments on U.S. fiscal stimulus and coronavirus vaccines amid a resurgence of infections in Europe.

MSCI’s broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS was a shade weaker, though it was not too far from a June 2018 peak at 568.84.

Australian .AXJO and New Zealand .NZ50 shares both opened in the red while South Korea’s KOSPI .KS11 was 0.1% up.

U.S. stock futures, the S&P 500 e-minis ESc1, were down 0.16%.

Japanese markets were closed for a public holiday.

“Attention is turning back to negotiations on supplementary fiscal stimulus and the forthcoming U.S. election,” ANZ analysts wrote in a note.

Coronavirus cases have now surpassed 30 million, casting a gloomy pall over prospects of a V-shaped economic recovery.

The biggest threat to global growth is

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LONDON (Reuters) – The U.S. dollar fell and the Australian dollar and Chinese yuan rose after the United States and China both hailed a phone call between their senior trade officials as a success.

That reaffirmed investors’ faith that even as diplomatic ties between the two countries fray, the trade relationship can endure.

On the call, which had been originally scheduled for Aug. 15, U.S. Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin spoke with Chinese Vice Premier Liu He.

The United States said both sides “see progress” and China’s commerce ministry called the talks “constructive.”

The news lifted the Australian dollar

0.2% to $0.7171 and nudged the Chinese yuan

firmer to 6.9070.

The greenback inched lower versus the euro, by 0.2% to $1.1813

, and by 0.2% against the British pound to $1.3088


The U.S. dollar was only up versus the Japanese yen,

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