Most emerging Asian currencies edged up on Friday, shrugging off better-than-expected Chinese trade data as markets took a breather from a volatile week of Sino-US trade tensions. Despite China's trade surplus coming in at its highest ever for any single month, according to Reuters data going back to 2008, the Chinese yuan cooled after earlier advances.
"The trade data, while is slightly better-than-expectations, does pre-date the implementation of the tariffs and markets at this stage are choosing to ignore the data because they are all largely historical," said Khoon Goh, ANZ's head of Asia research.
The crucial data here would be from July onwards to gauge the impact of the tariffs on activities, Goh added. Friday brings the culmination of a volatile week that saw the US threaten to impose new 10 percent tariffs on an additional $200 billion in Chinese imports, and saw the yuan depreciate for a fifth straight week.
China's second quarter economic growth due at the start of next week should provide a clearer indication of how the world's second-biggest economy performed. The dollar index, which tracks the greenback against a basket of six major rivals, was firmer in Asian trade and has been benefiting all week from a flight to safety as investors fret over trade conflict concerns.
Singapore's dollar was little changed at 1.364. Data out earlier in the morning showed that economic growth missed forecasts as worsening US-China trade tensions clouded the outlook for the trade-reliant city-state. The South Korean won, a currency that is sensitive to trade developments out of China, gained 0.2 percent to 1,124.1 per dollar.
On Thursday, the won slid as much as 0.9 percent after the country's central bank kept rates unchanged as expected, but a dissenting vote on the seven-member board appeared to raise the chance of a rate hike in the coming months. "The won will be the go-to trade on the escalation of trade war tensions, but in the meantime, the RMB complex will continue to dictate the pace of play," said Stephen Innes, head of trading APAC at Oanda.
The region's worst performer this year, the Indian rupee, strengthened 0.2 percent to 68.42 to the dollar, marking an end to a week which saw oil prices ease as well as weaker-than-expected inflation growth.