Asian currencies are trading flat-to-low as the Chinese economy shows a mixed recovery. The Chinese yuan has fallen 0.2% after data showed that industrial production grew less than expected in February.
Asian Currencies Trade Flat-to-Low Range
Most Asian currencies are trading in a flat-to-low range as investors await data on the Chinese economy. The Chinese yuan fell 0.2% on Wednesday after data showed that industrial production grew less than expected in February. The manufacturing sector struggled to recover from COVID-era lows, which contributed to the weak data.
The dollar, on the other hand, stuck to a near one-month low after consumer inflation eased as expected. The mixed economic data from China and the US has put pressure on Asian currencies, which are sensitive to the movements of the dollar.
Chinese Economy Shows Mixed Recovery
The Chinese economy is showing a mixed recovery, with some sectors struggling to regain momentum after the pandemic. According to data released on Wednesday, industrial production grew less than expected in February, indicating that the manufacturing sector is still struggling to recover from COVID-era lows.
However, the data also showed that retail sales and fixed asset investment exceeded expectations, indicating that consumer spending and investment are picking up in the world’s second-largest economy.
Impact on Asian Currencies
The mixed economic data from China and the US has put pressure on Asian currencies, which are sensitive to the movements of the dollar. The Chinese yuan fell 0.2% on Wednesday, while other Asian currencies traded in a flat-to-low range.
Investors are closely watching the Chinese economy, as it is a major driver of global growth. Any signs of weakness in China could have a ripple effect on other economies in the region.
Outlook for Asian Currencies
The outlook for Asian currencies remains uncertain, as investors weigh the impact of the pandemic on the global economy. While some sectors, such as retail sales and fixed asset investment, are showing signs of recovery in China, the manufacturing sector is still struggling to regain momentum.
Investors are also closely watching the US economy, as the Federal Reserve has indicated that it may start tapering its bond-buying program later this year. Any signs of a strengthening US economy could lead to a stronger dollar, which could put pressure on Asian currencies.
