Commodity-linked currencies surge


TOKYO: Commodity-linked currencies surged on Tuesday as market sentiment improved after disappointment over failed oil talks gave way to hope for the global economy.

“The risk environment has turned positive,” Sim Moh Siong, a foreign-exchange strategist at Bank of Singapore, told Bloomberg News.

“This is why commodity currencies have outperformed with the dollar on a weaker footing, and [the]dollar-yen [rate is]inching up to benefit from the risk-on.”

World markets were already enjoying buying last week following a series of upbeat readings from China—including on trade, investment and factory activity—suggesting a long-running growth slowdown in the country may be bottoming out.

Energy-linked currencies were well up against the greenback. The Australian dollar climbed 0.33 percent, buying 77.75 US cents in Tokyo—around its highest level since June—and the oil-linked Malaysian ringgit soared 0.96 percent.

Among the other gainers, the South Korean won jumped more than 1 percent after the country’s central bank on Tuesday kept its key interest rate unchanged at a record low of 1.5 percent.

The Singapore and Taiwan dollars, Thailand’s baht, and the Indonesian rupiah also booked healthy gains against the dollar.

Also on Tuesday, Tokyo revealed in an official document it will nominate 51-year-old banker Takako Masai to the Bank of Japan’s board to replace a policymaker whose term is set to expire by the end of June, Bloomberg News said.

The dollar was higher at 109.06 yen against 108.83 yen in New York. The euro also ticked up to 123.47 yen and $1.1321 from 123.14 yen and $1.1315 in US trade.



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