Asian Currencies Steady as Markets Await U.S. Jobs Data and RBI Decision

Asian currencies traded flat to slightly lower on Friday as traders remained cautious ahead of key U.S. nonfarm payrolls data and India’s central bank decision. A call between U.S. President Donald Trump and China’s Xi Jinping offered little relief to concerns over stalled trade negotiations.

The dollar hovered near a six-week low, with the dollar index down about 0.6% this week. Market focus was on May’s jobs report, expected to show further signs of a cooling U.S. labor market. Recent weak labor data has intensified expectations that the Federal Reserve may consider rate cuts later this year, although the Fed is likely to hold rates steady in June. Trump has also renewed calls for lower interest rates amid economic uncertainty.

The Chinese yuan’s USDCNY pair edged up 0.1% as the Trump-Xi call failed to boost sentiment. While the leaders noted progress, markets remained unconvinced without concrete steps toward a trade resolution. Meanwhile, broader Asian currencies saw limited movement, reflecting continued caution over U.S. economic policy and global growth outlook.

The Japanese yen weakened slightly, with USDJPY rising 0.2%. Disappointing household spending and wage data weighed on sentiment, raising doubts about Japan’s economic recovery and the Bank of Japan’s ability to raise rates.

India’s rupee was muted as markets awaited the Reserve Bank of India’s decision, with expectations of a 25 basis point rate cut due to easing inflation and strong growth indicators. The USDINR pair dipped 0.1%.

The Australian dollar fell 0.2% after a soft GDP reading earlier in the week, while Singapore’s dollar and South Korea’s won were largely unchanged amid thin holiday trading.

Markets now await clearer signals from the U.S. jobs report and the RBI's move to gauge regional momentum.