Yuan forwards are trading at the biggest discount to the spot rate in four years and the top Dim Sum debt underwriters predict a halt to appreciation.
Australia’s dollar and government bond yields climbed amid signs that a slowdown in China is bottoming out, easing concern demand for commodities will decrease in Asia’s biggest economy.
Thailand’s baht dropped to a four- month low before a review today at which the central bank is forecast to cut borrowing costs for the first time since October.
India’s rupee fell to the lowest level in 10 months on concern U.S. policy makers will rein in stimulus measures as the world’s largest economy recovers.
Australia’s dollar fell to an 11- month low after the premium the nation’s bonds offer over U.S. debt shrank to the least in a year, sapping the allure of the currency as a higher-yielding asset.
Concern the U.S. fiscal situation will deteriorate may push the dollar down versus the euro and the yen, according to HSBC Holdings Plc, Europe’s biggest bank.
The yuan fell in Hong Kong’s offshore market by the most in 15 months and the onshore spot rate retreated from a 19-year high as China stepped up scrutiny of cash transfers from abroad.
The yuan strengthened the most this year as Premier Li Keqiang pledged to come up with a plan this year that would allow investment capital to move more freely in and out of China.
Investors should buy the pound against the euro on speculation the Bank of England will raise interest rates “well before” the European Central Bank, according to HSBC Holdings Plc.
China’s yuan advanced to a 19-year high after the central bank set a record reference rate for the currency amid signs capital inflows are gathering pace.
"The dollar will continue to find support given the ongoing debate over the Fed and QE tapering, especially versus the Aussie."
- Paul Mackel on Jun 02, 2013