BENGALURU: Most emerging Asian currencies fell on Tuesday, pressured by a stronger greenback ahead of the US central bank’s policy meeting, and as data showed an unexpected decline in Chinese manufacturing activity.
The Thai baht, which led the losses among currencies, was down 0.7% at 36.135 per dollar by 0622 GMT.
An upsurge in oil prices due to the conflict in the Middle East has fuelled inflationary pressures in net-oil importing economies like Thailand, Indonesia and India, while adding to their import bills.
Data also showed Thailand’s manufacturing output fell at a higher-than-expected annual rate of 6.06%, weighed by weak exports amid a slowdown in the global economy.
Shares in Thailand fell 1.1%, set for their second consecutive monthly drop.
Shanghai’s benchmark index also declined, slipping 0.1%, while the yuan eased 0.1%.
China’s official purchasing managers’ index (PMI) fell to 49.5 in October from 50.2 in September, dipping back below the 50-point level demarcating contraction from expansion and consistent with only very slow overall economic growth.
The data, which is a discouraging reading for China’s Asian trading partners, continues to point towards “subdued growth conditions in the world’s second largest economy,” analysts at IG Asia said.
“The data may dent hopes of a more sustained recovery, given previous upside surprise in September’s numbers, and likely add to calls for more policy support to support the economy,” they added.
Investors will now look towards the Federal Reserve’s two-day monetary policy meeting outcome on Wednesday, which could set the tone for markets globally.
Meanwhile, the dollar index, measuring the greenback’s strength against six major rivals, strengthened 0.2% to 106.299, putting a dampener on regional currency markets.
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