(Adds details, context and updates prices)
By Chandini Monnapppa
Aug 1 (Reuters) - Most Asian currencies took to the
sidelines on Wednesday, with China's yuan choppy amid media
reports that Washington plans to raise tariffs on $200 billion
of imported Chinese goods.
Overall, traders were reluctant to make any big bets on
regional currencies as they waited on the U.S. Federal Reserve's
policy meeting later in the global day followed by the Bank of
England's own rates review on Thursday.
A raft of Asian manufacturing surveys also showed cooling
factory activity with heightened concerns the Sino-U.S. trade
dispute risks rippling across global supply chains in a blow to
world growth.
The dollar index, a measure of its value against a
basket of six major currencies, strengthened 0.2 percent at
94.649.
Traders were cautious after media reports said the Trump
administration plans to propose slapping tariffs of 25 percent
tariff, instead of 10 percent, on $200 billion of imported
Chinese good.
Trading in the Chinese yuan was a little choppy after
Bloomberg reported earlier, citing sources, that representatives
of U.S. Treasury Secretary Steven Mnuchin and Chinese Vice
Premier Liu He have been speaking privately as they seek to
restart negotiations.
"While the U.S. has threatened tariffs on Chinese imports,
it was cushioned by news that Liu He and Mnuchin are exploring a
restart of trade negotiations," said Wei Liang Chang, an FX
strategist at Mizuho Bank.
"The U.S. tariffs could be seen as an opening bid for
negotiations, and any negative repercussions on Asian FX could
thus be discounted for now."
Besides manufacturing surveys due out in Europe later in the
day, more catalysts will be on offer for traders as the Fed is
expected to keep rates on hold and remain on track to tighten
twice more by year-end, while the Bank of England is set to
raise borrowing costs on Thursday.
The Thai baht strengthened 0.2 percent, while the
Malaysia's ringgit and Indonesia's rupiah
weakened 0.1 percent and 0.2 percent, respectively.
India's rupee < INR=IN> was trading steady ahead of the
Reserve Bank of India's policy meeting, which is expected to
raise rates, according to a Reuters poll.
Chinese yuan
China's yuan was largely unchanged after booking
its fourth straight month of losses on Tuesday, as traders tried
to weigh the latest reports on the volatile Sino-U.S. trade
relations.
Earlier in the day, a private survey showed China's
manufacturing sector grew at the slowest pace in eight months in
July as export orders declined yet again in a worrying sign amid
an escalating trade dispute with the United States.
Prior to market opening, the People's Bank of China lowered
the daily yuan midpoint to 6.8293 per dollar, 128
pips or 0.19 percent weaker than the previous fix of 6.8165.
Wednesday's fixing, the lowest since May 31, 2017, largely
matched market forecasts, traders said.
The following table shows rates for Asian currencies against
the dollar at 0512 GMT.
CURRENCIES VS U.S. DOLLAR
Currency Latest bid Previous day Pct Move
Japan yen 111.910 111.86 -0.04
Sing dlr 1.362 1.3609 -0.08
Taiwan dlr 30.608 30.614 +0.02
Korean won 1120.700 1118.7 -0.18
Baht 33.170 33.26 +0.27
Peso 53.083 53.095 +0.02
Rupiah 14437.000 14415 -0.15
Rupee 68.560 68.54 -0.03
Ringgit 4.065 4.063 -0.05
Yuan 6.820 6.8181 -0.03
Change so far in 2018
Currency Latest bid End 2017 Pct Move
Japan yen 111.910 112.67 +0.68
Sing dlr 1.362 1.3373 -1.81
Taiwan dlr 30.608 29.848 -2.48
Korean won 1120.700 1070.50 -4.48
Baht 33.170 32.58 -1.78
Peso 53.083 49.93 -5.94
Rupiah 14437.000 13565 -6.04
Rupee 68.560 63.87 -6.84
Ringgit 4.065 4.0440 -0.52
Yuan 6.820 6.5069 -4.59
(Reporting by Chandini Monnappa in Bengaluru
Editing by Shri Navaratnam)
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