BENGALURU: Most Asian units firmed on Tuesday as China signalled further supportive measures to shore up its decelerating economy, after December trade data showed exports had fallen by the most in two years, hurt by a trade war with the United States.
Earlier in the day, the China state planner said the country will aim to achieve "a good start" in the first quarter for the economy, and added it would improve its "reserve" of economic policies.
The Chinese yuan firmed as much as 0.4 percent earlier, but its strength moderated in noon trade.
Vice head of the People's Bank of China said China is confident it can keep its foreign exchange rate stable despite cuts in banks' reserve requirement ratio.
Asian currencies have been suffering from worries of the fallout from the Sino-U.S. trade war and nervousness over the outlook for the global economy.
But they have been helped recently by expectations that the Federal Reserves would pause its rate hikes this year as the U.S. economy displayed signs of cooling.
The Thai baht led gains in the region, strengthening 0.3 percent, while the South Korean won and the Taiwan dollar was modestly firmer.
Elsewhere, the Indonesian rupiah firmed slightly against the greenback. Government data released earlier in the day showed Indonesia's trade deficit narrow in December, but was worse than expected as exports dropped.
Indonesia's central bank is expected to keep its benchmark interest rate unchanged at a policy meeting on Thursday as concerns about the rupiah has dissipated, a Reuters poll showed.
INDIAN RUPEE TRADES SIDEWAYS
The rupee traded in a tight range on Tuesday as data showed annual retail inflation in December at its lowest in 18 months, potentially clearing the way for an easier monetary policy.
"With headline inflation trending at the lower end of the RBI's target range, a shift in the policy stance from ‘calibrated tightening’ to ‘neutral’ is on the cards at the 7 February policy meeting," DBS Bank economist Radhika Rao and FX strategist Philip Wee said in a note. - Reuters
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