Asian currencies may see near-term relief following the weaker-than-expected U.S. nonfarm payrolls report, according to two strategists at OCBC Group Research. The report "took some of the urgency out of further Fed tightening," though the strategists remain cautious about a broad Asian FX rally. Long-dated U.S. Treasury yields stay elevated while oil prices remain high, leaving oil-importing currencies like the Indonesian rupiah, Philippine peso, and Thai baht relatively exposed. The dollar is little changed at 62.486 pesos and 0.1% higher at 33.56 baht, LSEG data show.
In early trade, Asian currencies consolidate against the dollar but may benefit from reduced Fed rate-hike prospects, which typically diminish the appeal of U.S. fixed-income assets. ANZ Research analysts note that financial markets viewed September's softer U.S. labor market report as giving the FOMC more time to assess conditions before adjusting policy further. Senior Fed officials have signaled no need for urgency, and markets have sharply reduced expectations of an October rate hike.
The U.S. dollar edges 0.1% lower to 157.68 yen but remains little changed at 1.2793 Singapore dollars, LSEG data show.
Source: Wall Street Journal Markets · Summarized by HeadlinesBriefing