Asian currencies have continued to rebound against the US dollar over the past month, and most are now up by around 5-15% against the greenback since early November. Optimism around China’s reopening and expectations for a Fed policy pivot have been the two key factors behind the turnaround. Appreciating currencies are being welcomed by policymakers across the region, who had become concerned about the risk of higher import price inflation. With economic growth across most of the region slowing (all six countries in the region to have reported Q4 GDP figures experienced slower growth) and inflation dropping back, the rebound in Asian currencies supports our view that central banks are nearing the end of their tightening cycles.
Become a client to read more
This is premium content that requires an active Capital Economics subscription to view.
Already have an account?
You may already have access to this premium content as part of a paid subscription.
Sign in to read the content in full or get details of how you can access it
Register for free
Sign up for a free account to gain:
- Unlock additional content
- Register for Capital Economics events
- Receive email updates and economist-curated newsletters
- Request a free trial of our services