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MUFG expects Asian FX resilience versus the US dollar
MUFG ties the outlook to strong AI-related exports in Asia and a less acute oil and diesel supply situation in the region.
FXStreet, citing MUFG strategist Michael Wan, said Asian currencies have shown more resilience than other FX markets, supported by strong AI-related exports and a less acute oil and diesel supply situation in the region.
MUFG also sees a good chance that Asia FX can outperform across various scenarios, though it expects dispersion across different currency pairs rather than uniform gains.
The commentary noted that previous concerns about FX carry unwinds in Latin America have stabilized, which it said reinforces Asia’s relative appeal.
FXStreet also pointed to the US dollar’s continued bullish tone, despite receding expectations for an October Fed hike, with AUD/USD holding above 0.6950 while the pair’s two-day recovery from a two-month low stalled amid elevated US bond yields and geopolitical uncertainties.