Most Asian currencies traded within a narrow range on Thursday. The Japanese yen hovered near levels that have previously triggered government intervention, while the U.S. dollar held steady after President Donald Trump signed a bill to end the prolonged government shutdown.
The Australian dollar outperformed regional peers. Stronger-than-expected employment data reduced expectations for further interest rate cuts by the Reserve Bank of Australia. The AUD/USD pair rose 0.2%.
Across the region, other Asian currencies saw limited movement. The Chinese yuan slipped 0.1% in the USD/CNY pair after the People’s Bank of China set a stronger midpoint fix.
The South Korean won eased slightly from a seven-month high in the USD/KRW pair. The Singapore dollar’s USD/SGD pair and the Taiwan dollar’s USD/TWD pair showed little change.
In India, the rupee weakened. The USD/INR pair rose 0.1% after consumer inflation for October came in far below expectations, increasing expectations of more rate cuts by the Reserve Bank of India.
Japanese yen nears intervention levels
The yen saw mild weakening on Thursday. The USD/JPY pair briefly moved above 155, a level not touched for nearly 10 months. The yen also hit a record low against the euro, reflecting a growing bearish sentiment toward the currency.
The 155 level has prompted Japanese government intervention in the past. Traders are now watching closely to see whether Prime Minister Sanae Takaichi’s administration will step in again.
Bank of Japan Governor Kazuo Ueda maintained a dovish stance, saying the central bank aims for moderate inflation supported by wage growth and economic expansion.
Finance Minister Satsuki Katayama repeated that it was too soon for the BOJ to raise rates, with inflation still below the 2% annual target.
Dollar holds steady as U.S. shutdown ends
The dollar index and dollar index futures were little changed in Asian trading. President Donald Trump signed a bill to restore government funding, officially ending the longest shutdown in U.S. history.
He signed the measure shortly after the House of Representatives passed it by a narrow margin.
The shutdown ended just hours before it would have entered its 43rd day. Traders are now watching for signs of its economic impact.
With the government reopened, delayed U.S. economic data for October and November is now set for release and is expected to reflect the shutdown’s effects.
President Trump said on Wednesday that the shutdown cost the U.S. economy an estimated $1.5 trillion.
