Most emerging Asian currencies eased on Monday as China's yuan hit a more than 5-1/2-year trough after the central bank set its daily guidance rate at its lowest since October 2010 with the dollar firm after upbeat US economic data.
Currencies of emerging Asian countries had a muted reaction to the failed coup in Turkey as the authorities over the weekend foiled the attempt by some in the military to overthrow the government. The Turkish lira jumped as much as 2.4 percent in thin Asian trade on Monday, after falling nearly 5 percent on Friday following news of the coup bid.
The yuan fell to 6.9998 per dollar, its weakest since November 2010, before state-run banks were suspected of selling dollars on behalf of the central bank around 6.6996 to support the renminbi.
Such weakness dragged South Korea's won, Singapore's dollar and Malaysia's ringgit weaker.
"Once the yuan breaches a critical point of 6.7, it will be difficult for other emerging Asian currencies to ignore that," said Jeong My-young, Samsung Futures research head in Seoul.
"That will spur caution on further strength in Asian FX."
Emerging Asian currencies have been enjoying capital inflows on expectations that global central banks may ease monetary policies to support their economies in the wake of Britain's vote to leave the European Union last month.
The renminbi held a more bearish tone among regional currencies as China's authorities were seen allowing further weakness. Policy sources told Reuters in June that the People's Bank of China would tolerate a fall in the currency to as weak as 6.8 in 2016 to support struggling exporters.
The ringgit slid amid low trading volume as traders cut some of their bullish bets on the US dollar's broad strength.
The greenback held firm against a basket of six major currencies as strong US retail sales and industrial production caused investors to price in more odds of the Federal Reserve's interest rate hike this year.
"It is better to see if US rate-hike talks resurface," said a senior Malaysian bank trader in Kuala Lumpur.
Chances for a rate increase by December rose to 46 percent on Friday, according to CME Group's FedWatch tool. Traders had priced in less than a 20-percent chance as recently as late June.
Still, the Malaysian currency pared some of its earlier losses as most government bond prices rose.
The won eased on caution that South Korea's foreign exchange authorities may not allow the currency to strengthen past a chart resistance area between 1,133 per dollar and 1,128.
The South Korean currency recovered some of its earlier losses as foreign investors continued to buy Seoul shares.