Most Asian currencies up

Most emerging Asian currencies strengthened against the dollar on Monday, as remarks from the US Federal Reserve chief reaffirmed expectations for another rate cut, while the yuan eased after Beijing's latest stimulus measures. Fed Chairman Jerome Powell said on Friday the central bank will continue to act "as appropriate" to sustain economic expansion, a phrase that investors have read as signalling further interest-rate reductions ahead.
The dollar index, measured against a basket of six major currencies eased on Friday after Powell's remarks and last traded little changed. The case for more stimulus from major central banks was underlined by a soft US jobs report on Friday and data on the weekend showing an unexpected drop in Chinese exports as policymakers look to stave off a global recession.
Mahesh Sethuraman, Deputy Head of Global Sales Trading at Saxo Capital Markets, said the relief for emerging currencies may not last long as worries over a worlwide manufacturing slowdown weigh on risk sentiment. The South Korean won was the top performer in region, strengthening 0.5% against the greenback to its highest level in more than a month.
The Taiwan dollar edged higher ahead of the release of trade figures which are expected to show that exports contracted for a second straight month in August. Malaysian financial markets were closed for a public holiday. The Chinese yuan eased 0.2%, after the country's central bank on Friday cut the amount of cash that banks must hold as reserves for the third time this year.
The move is expected to release 900 billion yuan ($126.35 billion) in liquidity to shore up the flagging economy.Data released over the weekend also showed China's exports unexpectedly fell in August as shipments to the United States slowed sharply, pointing to further weakness in the world's second-largest economy.
"At the end of the day, China cannot offset all the pain of a slowing economy and the trade war with just rate cuts. There is only so much room that they have to cut rates and don't forget leverage is still a problem for China," Sethuraman said.