Most Asian currencies pared this week’s losses after the announcement that investors with 95.7 percent of Greece’s privately held bonds will participate in a debt swap and a report indicated China’s inflation slowed.
The MSCI Asia-Pacific Index of stocks climbed 0.7 percent on Friday, capping its biggest two-day advance since January. Consumer prices in China rose last month at the slowest pace since June 2010, providing scope for the central bank to ease monetary policy and support economic growth. Malaysia’s ringgit fell following a two-day rally as the country’s central bank left interest rates unchanged for a fifth straight meeting.
Optimism about the Greek debt swap “was priced into the market before the announcement and the announcement is a nice relief,” said Choong Yin Pheng, manager for economic and bond research at Hong Leong Bank BHD in Kuala Lumpur. “China is growing relatively strongly and people are hopeful for more supporting policies.”
The New Taiwan dollar climbed 0.1 percent on Friday to NT$29.504 and was down 0.2 percent from March 2. India’s rupee appreciated 1 percent to 49.795 per US dollar in Mumbai, trimming its weekly decline to 0.6 percent, according to data compiled by Bloomberg. Indonesia’s rupiah rose 0.2 percent to 9,123 per US dollar, paring its weekly loss to 0.5 percent.
The Bloomberg-JPMorgan Asia Dollar Index climbed as much as 0.1 percent on Friday and closed at 117.42, little changed from the day before. It ended the week lower for the first time since Feb. 10. The index’s 60-day historical volatility dropped to 3.35 percent, the lowest measure of price swings since August last year, signaling reduced market uncertainty.
China’s yuan gained the most in a month after data showed consumer prices last month rose 3.2 percent from a year earlier, less than the 3.4 percent estimate of economists in a Bloomberg News survey. The currency on Friday climbed 0.09 percent to 6.3107 per US dollar, paring this week’s loss to 0.2 percent, according to the China Foreign Exchange Trade System.
“Easing inflation is good news for China’s economy as it means more room for policy easing,” said Daniel Chan, chief economist at BWC Capital Markets in Hong Kong.
The Bank of Korea left its seven-day repurchase rate on hold for a ninth straight month at 3.25 percent this week, while Bank Indonesia kept its reference rate at 5.75 percent.
Meanwhile, South Korea’s won closed the week 0.2 percent lower at 1,117.90, while the Philippine peso strengthened 0.3 percent 42.585. Vietnam’s dong was little changed on Friday and climbed 1 percent to 20,830 over the week. Thailand’s baht dropped 0.2 percent on Friday to 30.59, ending the week down by the same margin.