The South Korean won and Philippine peso firmed on Friday, tracking stronger Asian stocks and gains in the euro, but the Chinese yuan hit a fresh six-week low after the central bank set a weaker daily mid-point. The dollar index, a gauge of the its performance against six major currencies, fell 0.4 percent ahead of a spate of US data, including retail sales, consumer confidence and consumer prices, later in the day.
The euro extended early gains to $1.2892, up 0.5 percent on the day, after data showed Germany's economy grew by a stronger-than-expected 2.2 percent in the second quarter. But the dollar fought its way higher on the yen following a report Japan's prime minister and the head of its central bank would meet to discuss ways to deal with the Japanese currency's export-sapping strength.
Thai markets were shut for a holiday. The Philippine peso gained nearly 0.4 percent to 45.21 per dollar thanks to broad dollar weakness. A break of 44.75 will take peso towards 44.50, last hit on May 13.
On the downside, the peso may face some near-term pressure against the dollar following its recent rally but the 100-day MA, which is at 45.60 on Friday, should provide some support, charts show. Peso has gained just over 2 percent against the dollar in the past three weeks.
Meanwhile, one-month dollar/peso NDFs fell to 45.35 from 45.49 late on Thursday. The South Korean won briefly fell to 1,191.9 per dollar but rebounded to 1,180.9 - up half of a percent from Thursday's close - as rising local stocks and a firmer euro prompted investors to clear dollar-long positions.
Dealers said they had not yet seen won selling linked to Hyundai Heavy Industries Co Ltd's purchase of a controlling stake in a local refiner from Abu Dhabi-based International Petroleum Investment Co. "Weaker US stocks prompted investors to prefer dollar-long positions initially. But local shares are strong and the euro rose, causing them to clear the positions," said a foreign bank dealer.
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