Most Asian currencies weakened on Monday as investors braced for a week packed with economic data that could set the tone for the region's economies and markets at a time of widespread uncertainty and persistent trade tensions.
The People's Bank of China strengthened the yuan's official midpoint fixing to 6.6157 to the dollar after eight consecutive weaker fixings. Trade tensions have already hammered the yuan which registered its worst month on record in June and was trading 0.4 percent lower on Monday.
A private survey on Monday showed that growth in China's manufacturing sector cooled slightly in June. The Caixin/Markit Manufacturing Purchasing Managers' index showed new export orders contracted for the third straight month and the most in two years, though there was no significant slide from the previous two months.
The survey followed government data issued at the weekend showing growth in China's manufacturing sector slowed in June after a better-than-expected performance in May.
The yuan could face another challenge on July 6 when the United States is due to impose tariffs on $34 billion worth of Chinese goods. Beijing is expected to respond with tariffs of its own on US goods. "While the tariffs have yet to kick in and show up in actual export numbers, trade war tremors have triggered mini-quakes in China's manufacturing PMI," Mizuho Bank said in a note.
"If trade salvos escalate into a full-blown war, adverse and abrupt repercussions for wider EM Asia (via supply-chain linkages)...will be disproportionate."
The Indonesian rupiah slipped 0.5 percent, the most among the regional currencies, while the export-dependent Singapore dollar and South Korean won weakened 0.3 percent and 0.5 percent, respectively.
The won's fall was in line with Seoul's KOSPI stock index which dipped 1.9 percent on political risks seen in the European Union and concerns over China's economic growth.
The Indian rupee, the region's worst-performing currency in 2018, weakened 0.3 percent while close second the Philippine peso traded 0.1 percent lower.
The rupiah slid on Monday after the statistics bureau said annual inflation rate slowed less than expected in June from a year ago and stayed within Bank Indonesia's target range.
June's annual inflation rate came in at 3.12 percent, compared with May's 3.23 percent.
Indonesia's central bank had hiked its policy interest rate by 50 basis points, twice what the market expected, as it stepped up efforts to stabilise the volatile rupiah.
The Thai baht was firmer after trimming some early gains.
Thailand's annual headline consumer price index rose 1.38 percent in June, compared with a forecast of a 1.54 percent increase, and against May's 1.49 percent rise, commerce ministry data showed.
The inflation rate was in line with the ministry's predicated range which has left its policy interest rate unchanged at 1.50 percent, near record lows, since April 2015.