KUALA LUMPUR: Several Asian currencies including Malaysian ringgit and the Thai baht hit its strongest levels in more than seven months after the U.S. Federal Reserve lowered its expectations for the pace of interest-rate increases during the rest of 2016.
The Australian dollar and the Singapore dollar rose to eight-month highs against their U.S. counterpart, with the Aussie strengthening 1.8% to 0.7592 compared with yesterday’s close in London, according to Wall Street Journal.
The Singapore dollar moved 1.3% firmer to 1.3635 against its U.S. counterpart versus the London close and the Korean won hit its strongest level all year, last gaining 1.6% to 1,173.0.
The paper added, after the Fed’s decision to keep rates on hold, the People’s Bank of China set its daily yuan reference rate against the U.S. dollar at 6.4961, a level 0.3% firmer than the previous day. The offshore yuan trading in Hong Kong strengthened 0.1% to 6.4920 in response.
“A weaker dollar could put further pressure on Asian countries that are already experiencing a slowdown in growth. As the value of their currencies rises, it makes it harder for some of the region’s export-dependent economies to grow,” it said.