Investing.com -- Most Asian currencies retreated on Tuesday tracking softer-than-expected Chinese import data, while the dollar firmed ahead of more cues on the U.S. economy from key inflation data due this week.
While exports grew more than expected, they still expanded at a slower pace from the prior month, further pointing to a mixed economic recovery in the country as the local manufacturing sector struggles.
Weak Chinese demand also bodes poorly for countries with large trade exposure to China. A slew of Southeast Asian currencies softened on that notion, with the Philippine peso and the Indonesian rupiah losing 0.6% and 0.4%, respectively.
A deepening trade deficit also weighed on the peso.
The Japanese yen was flat after tumbling sharply from a near two-month high hit earlier in May. Bank of Japan Governor Kazuo Ueda reiterated that monetary policy is likely to remain dovish in the near-term, heralding little support for the yen.
Safe haven demand for the Japanese currency was hit by easing fears of a U.S. banking crisis, as a Federal Reserve survey showed that the recent collapse of several banks had a limited impact on loan activity.
Treasury Secretary Janet Yellen also said that U.S. bank deposits had largely stabilized from the turmoil seen earlier in the year.
Inflation data due Wednesday is expected to show that price pressures eased slightly in April from the prior month. But any signs of stubborn inflation could elicit a hawkish response from the Fed, which recently flagged a more data-driven approach to .
Add Chart to Comment
We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:
- Enrich the conversation
- Stay focused and on track. Only post material that’s relevant to the topic being discussed.
- Be respectful. Even negative opinions can be framed positively and diplomatically.
- Use standard writing style. Include punctuation and upper and lower cases.
- NOTE: Spam and/or promotional messages and links within a comment will be removed
- Avoid profanity, slander or personal attacks directed at an author or another user.
- Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
- Only English comments will be allowed.
Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.