AFP, Singapore :
The US dollar retreated in Asia Tuesday in cautious trading as investors waited for the release of key economic data from the United States that could influence a Fed decision on interest rates.
The Australian and New Zealand dollars also gained against the US currency ahead of a meeting of the Reserve Bank of Australia (RBA), with analysts saying it remains a close call on whether the Australian central bank will keep interest rates the same.
Japanese financial markets are closed for a holiday.
“In what is going to look like a bumpy week, investors are rather cautious,” Bernard Aw, market strategist at IG Markets in Singapore, told AFP.
He said investors are easing their US dollar positions as they wait for fresh economic data this week from the United States expected to give a clearer picture of the health of the world’s biggest economy, including the closely-watched non-farm payrolls.
“Investors are paring back their long dollar positions and this is helping Asian currencies,” Aw said.
He added that the US data would “set the tone” for more speculation on the next move by the Fed, the US central bank, on interest rates.
The Fed has so far held back from the first interest rate hike since 2006, citing sluggish global economic conditions.
Last month, however, members of the policy setting Federal Open Market Committee hinted they might raise rates during their last meeting of the year in December.
An increase in US interest rates would typically swing investments into the United States for higher returns, boosting the US currency.
In Singapore trade at around 0340 GMT, the US dollar was down against the Singapore dollar, Taiwan dollar, South Korean won, Philippine peso, Indonesian rupiah, Indian rupee, Chinese yuan, Malaysian ringgit and the Thai baht.
The dollar was also trading at 120.7438 Japanese yen, down from 120.77 in late US trade in New York on Monday.
