SINGAPORE: Asian currencies caught a boost from better-than-expected Chinese economic data on Wednesday, driving the yuan to a one-week high and putting a dampener on the US dollar which has rallied for weeks on end as US yields have climbed.

A blast at a Gaza hospital also kept moves modest and traders on edge at the prospect of a widening conflict. US President Joe Biden is due to visit Israel on Wednesday. The shekel was pinned to the weaker side of 4-per dollar.

Official data showed China’s economy grew 1.3% in the third quarter, accelerating from 0.5% in the previous quarter and topping market forecasts for an increase of 1%. Industrial output rose and unemployment fell.

“It pretty much means the growth target for this year of around 5% will be achieved, maybe slightly above,” said UOB economist Woei Chen Ho in Singapore.

The yuan and trade-dependent Australian and New Zealand dollars all bounced. The Aussie was last up 0.2% at $0.6378. The kiwi rose by the same margin to $0.5909. The yuan hit a one-week high of 7.2905 per dollar.

On Tuesday US yields had shot sharply higher after data showed retail sales increased strongly, which had helped the dollar pile pressure on the low-yielding Japanese yen.

The yen was last at 149.68 to the dollar and was squeezed, as the Bank of Japan had unexpectedly announced $2 billion in bond-buying to keep downward pressure on yields.

Elsewhere the greenback had struggled to gain, which some analysts suggested could point to a loss of momentum.