Asian currencies fell, led by Indonesia’s rupiah, as data showed the region isn’t immune to the global economic slowdown, deterring risk-taking. The MSCI Asia-Pacific Index of shares dropped for a fifth day after a report yesterday showed Chinese imports missed estimates. Growth in the Chinese and Singaporean economies declined in the second quarter, according to median estimates in Bloomberg surveys before data due July 13. The International Monetary Fund will lower its 3.5 percent global-expansion forecast for this year in its next update July 16, Managing Director Christine Lagarde said this month., “There is the question of how deep the current slowdown will be and that keeps the market bullish on the U.S. dollar for now,� said Choong Yin Pheng, manager for economic and bond research at Hong Leong Bank Bhd. in Kuala Lumpur. “The risk of interest-rate cuts in Asia is keeping investors cautious� after two reductions within a month in China, she said. The rupiah dropped 0.3 percent to 9,460 per dollar as of 9:38 a.m. in Jakarta, according to prices from local banks compiled by Bloomberg. Thailand’s baht slipped 0.2 percent to 31.71, Malaysia’s ringgit weakened 0.1 percent to 3.1818, South Korea’s won fell 0.1 percent to 1,144.35 and the Philippine peso dropped 0.1 percent to 41.890. The Bloomberg-JPMorgan Asia Dollar Index halted a two-day advance, while its 60-day historical volatility was little changed at 3.61 percent. China’s economy expanded 7.7 percent in the second quarter from a year earlier, easing from an 8.1 percent pace in the first three months this year, according to a Bloomberg survey. Inbound shipments into Asia’s largest economy increased 6.3 percent in June from a year earlier, compared with a forecast for an 11 percent gain in a Bloomberg survey. Rate Meetings Singapore may report that the city-state’s GDP expanded at an annual rate of 1.2 percent, following a 10 percent gain in the first quarter, according to a Bloomberg survey. “Recent data are not helping to remove growth concerns,� said Yuji Kameoka, chief currency strategist at Daiwa Securities Co. in Tokyo. “Investors are reluctant to take risks.� The Bank of Korea holds its policy meeting tomorrow, at which 14 of 16 economists surveyed by Bloomberg predict the benchmark rate will be held at 3.25 percent. Two expect a 25 basis point cut. Bank Indonesia will hold borrowing costs at 5.75 percent tomorrow, according to all 20 analysts in another Bloomberg survey. Yuan Fixing “The two benchmark rate cuts within a month by the People’s Bank of China have heightened concern over the economic downturn given the influence of Chinese growth to Asia,� Societe Generale SA said in a note to clients today. The time is ripe for Bank of Korea to turn dovish, it said. China’s yuan fell 0.03 percent to 6.3676 per dollar in Shanghai, according to the China Foreign Exchange Trade System. The People’s Bank of China set the currency’s reference rate 0.02 percent lower at 6.3209. Based on the forecasted 7.7 percent pace, growth in the world’s second-largest economy will be the slowest in three years. “We’ve seen Chinese numbers yesterday showing a very sharp decline in imports, which raises the concern that there’s a slowdown in the global economy, particularly in Asia,� said Suresh Kumar Ramanathan, head of regional currency strategy at CIMB Investment Bank Bhd. in Kuala Lumpur. Elsewhere, Taiwan’s dollar climbed 0.2 percent to NT$29.940 per dollar on speculation exporters are converting overseas earnings. The Vietnamese dong rose 0.1 percent to 20,880. To contact the reporters on this story: David Yong in Singapore at dyong@bloomberg.net To contact the editor responsible for this story: Sandy Hendry at shendry@bloomberg.net

Source