Most Asian currencies fell on Wednesday, while the dollar steadied from recent losses as markets hunkered down before more cues on monetary policy from Federal Reserve Chair Jerome Powell later in the day.<\/p>\n
Powell is set to\u00a0testify before Congress<\/a><\/span>\u00a0later in the day, potentially offering more cues on the path of U.S. interest rates after somewhat mixed signals from a\u00a0Fed meeting<\/a><\/span>\u00a0last week.<\/p>\n While the bank paused its rate hike cycle, it flagged a higher peak interest rate this year, potentially heralding more increases in rates.<\/p>\n This kept investors uncertain over what Powell may signal in his testimony, drawing some flows into the dollar on the potential for a hawkish outlook.<\/p>\n The\u00a0dollar index<\/a><\/span>\u00a0and\u00a0dollar index futures<\/a><\/span>\u00a0rose slightly in Asian trade after logging some gains earlier this week.<\/p>\n The\u00a0Chinese yuan<\/a><\/span>\u00a0continued to lag its regional peers, sinking 0.2% to a near seven-month low of 7.1939 against the dollar after the People\u2019s Bank of China cut its key\u00a0loan prime rate<\/a><\/span>\u00a0on Tuesday.<\/p>\n The PBOC cut its 1-year and 5-year LPR by 10 basis points each. The cut was the PBOC\u2019s first such move in 10 months, and comes as Beijing struggles to shore up a slowing local economic rebound.<\/p>\n While the move is expected to help support economic growth, it bodes poorly for the yuan, as rising interest rates in the rest of the globe diminish the currency\u2019s appeal.<\/p>\n The cut in the 5-year LPR also disappointed some traders hoping for a bigger reduction, given that the rate is used to peg mortgage prices and is closely tied to the Chinese property market.<\/p>\n Most other Asian units fell as markets feared any more hawkish signals from Powell later in the day, which could herald higher U.S. interest rates.<\/p>\n The\u00a0South Korean won<\/a><\/span>\u00a0lost 0.3%, while the\u00a0Indian rupee<\/a><\/span>\u00a0fell 0.1%. The\u00a0Australian dollar<\/a><\/span>\u00a0was among the few outliers for the day, rising 0.1% after steep losses in the prior session.<\/p>\nChinese yuan hits near 7-month low after rate cut<\/span><\/h2>\n
U.S. rate-hike fears dent broader Asian currencies<\/span><\/h2>\n