AFP, Tokyo :
Asian currencies gained Thursday, recovering from the worst two-day rout in almost 20 years after China reassured markets it would not engage in a currency war.
Emerging market currencies including the Indonesian rupiah, Philippine peso and South Korean won rose slightly against the dollar after China Thursday devalued the yuan by 1.1 percent.
The cut, which was smaller than those in the previous two days, and news the central bank intervened to stabilise the yuan on Wednesday reassured dealers Beijing would not allow its currency to slump.
“It’s likely the worst is over,” Patrick Bennett, a strategist at Canadian Imperial Bank of Commerce in Hong Kong, told Bloomberg News.
“PBoC (People’s Bank of China) intervention has calmed the market. There is not a sense that the onshore yuan will weaken forever.”
In Tokyo late afternoon trade the dollar changed hands at 124.49 yen, up
from 124.24 yen in New York, where it took a hit on fears Beijing’s moves
underscored weakness in China’s economy and could delay a US interest rate hike.
China’s latest devaluation comes after the two previous cuts, on Tuesday and Wednesday, sparked concerns that the world’s number two economy is weaker than previously thought.
The move sent Asia-Pacific currencies plummeting, pushing the Malaysian ringgit to 17-year lows, on fears the cut could hurt other regional economies.
Asian currencies gained Thursday, recovering from the worst two-day rout in almost 20 years after China reassured markets it would not engage in a currency war.
Emerging market currencies including the Indonesian rupiah, Philippine peso and South Korean won rose slightly against the dollar after China Thursday devalued the yuan by 1.1 percent.
The cut, which was smaller than those in the previous two days, and news the central bank intervened to stabilise the yuan on Wednesday reassured dealers Beijing would not allow its currency to slump.
“It’s likely the worst is over,” Patrick Bennett, a strategist at Canadian Imperial Bank of Commerce in Hong Kong, told Bloomberg News.
“PBoC (People’s Bank of China) intervention has calmed the market. There is not a sense that the onshore yuan will weaken forever.”
In Tokyo late afternoon trade the dollar changed hands at 124.49 yen, up
from 124.24 yen in New York, where it took a hit on fears Beijing’s moves
underscored weakness in China’s economy and could delay a US interest rate hike.
China’s latest devaluation comes after the two previous cuts, on Tuesday and Wednesday, sparked concerns that the world’s number two economy is weaker than previously thought.
The move sent Asia-Pacific currencies plummeting, pushing the Malaysian ringgit to 17-year lows, on fears the cut could hurt other regional economies.
