Most Asian currencies gain

Nearly all Asian currencies strengthened on Monday, as the dollar slipped to near two-week lows after US President Donald Trump railed against the Federal Reserve's tightening policy. Regional currencies got a break from after Trump on Friday complained about the recent strength of the US dollar, stoking some fears that his comments would encourage Fed Chairman Jerome Powell to slow the pace of hikes this year.
The dollar index fell 0.3 percent against a basket of six major currencies, to 94.207, before paring losses to 94.379 at 0600 GMT. "It is too early to consider that the Fed's independence is going to be jeopardised as suggested by a modest steepening of the UST curve last week," DBS Bank strategists Philip Wee and Eugene Leow wrote in a note.
"It appears unlikely that Powell will risk the Fed's reputation on curbing inflation." On Friday, Trump also accused the European Union and China of manipulating their currencies and escalated risk with a threat to impose tariffs on all $500 billion of Chinese exports to the United States unless Beijing agrees to major structural changes to its technology transfer, industrial subsidy and joint venture policies.
The Chinese yuan, which has been volatile amid the intensifying Sino-US trade row, was 0.4 percent firmer at 6.7614 per dollar. The United States and China, have so far slapped tariffs on $34 billion worth of each other's goods.
The Singapore's dollar edged up 0.1 percent against its US peer. Data showed the city-state's headline consumer price index in June rose 0.6 percent from a year earlier, the most in seven months. Taiwan's dollar shrugged off weak economic data on Friday and gained as much as 0.4 percent. Export orders for Taiwan in June surprisingly fell 0.1 percent from a year ago to $40.31 billion.
Export-dependent South Korea's won rose as much as 0.6 percent, while the Thai baht, Malaysian ringgit and the Indian rupee each strengthened 0.2 percent. The Philippine peso, one of emerging Asia's worst performing currencies this year, slipped 0.3 percent. The yuan snapped four straight sessions of losses after Trump's criticism and following a firmer currency fixing by the Chinese central bank.
"The recent comments from Trump administration on currency manipulation may prompt RMB short sellers to take the profit," OCBC said in a note on Monday. Prior to market opening, the People's Bank of China set the midpoint rate at 6.7593 per dollar, 78 pips firmer than the previous fix of 6.7671. The official guidance rate largely matched market expectations and lifted the spot yuan higher.