Greenback stronger against emerging market currencies
The U. S. dollar was little changed against most of its AsiaPacific peers on Friday as foreign exchange dealers looked ahead to closely watched U.S. employment figures released later in the day.
A handful of currencies including the South Korean won fell against the dollar as most regional equity markets paused after a two-day rally marking the beginning of the month.
With analysts hoping for fresh clues from the U.S. jobs report on whether the Federal Reserve will change its monetary policy this year, the greenback edged up against a handful of other currencies from emerging economies.
“Today’s U.S. payrolls number has once again been labeled a ‘ much watch,’” Chris Weston, chief markets strategist at IG Markets, said.
“To be fair, I think traders are getting a bit exhausted of these event risks which are supposed to carry so much weight that they can alter the investment landscape.”
Equity markets have seen a spike in volatility since China suddenly devalued its yuan currency in August, triggering the largest quarterly selloff since 2011.
The turmoil in financial markets was a key factor the Fed held off raising near-zero interest rates in September, but investors still expect the hike to come before the end of the year.
The won declined 0.35 percent against the U.S. unit, while the Malaysian ringgit was down 0.29 percent, the Singapore dollar fell 0.20 percent, and the Thai baht lost 0.21 percent.
Other Asia- Pacific currencies rose against the dollar: the “Aussie” advanced 0.27 percent to 70.49 U.S. cents, the Indian rupee rose 0.11 percent, and the Indonesian rupiah gained 0.10 percent.
With the unemployment rate expected near seven-year lows, a strong reading in the unemployment figures will likely add to calls for the U.S. central bank to start raising rates gradually, putting further pressure on emerging economies as investors take out their cash to seek better returns in the U.S.
The U.S. unit rose to 120.05 yen from 119.93 yen Thursday in New York, while the euro traded at US$1.1169 and 134.08 yen from US$1.1187 and 134.16 yen in U.S. trade.