MOST ASIAN CURRENCIES barely budged in thin holiday trade on Tuesday, with the Chinese yuan briefly rallying to a 3-1/2-month high before retreating on corporate dollar demand.

China’s central bank lifted its official yuan midpoint to the highest level in over three months at 6.5416 per dollar, reflecting a strong spot yuan performance a day earlier.

That pushed the onshore yuan to a high of 6.5330 per dollar at one point in early trade, the strongest level since Sept. 13, but it came off in the afternoon to be down on the day. Traders said corporate buying of dollars weighed on the yuan.

The dollar index, which measures the US currency against a basket of six rivals, was down 0.08% at 0446 GMT.

“The (US) dollar may have weakened perhaps due to the month-end factor. Going to the month end, there might be a little bit of rebalancing taking place, and that could have led to the dollar sell-off,” said Sim Moh Siong, foreign exchange strategist at Bank of Singapore.

Among other regional currencies, the South Korean won was up 0.3%, its highest in nearly four weeks, while the Taiwan dollar advanced 0.08%, having risen as much as 0.2% and hitting its highest in more than three months.

Markets in the Philippines and Indonesia were closed for trading.

SINGAPORE DOLLAR
The Singapore dollar was little changed after November inflation and industrial production data didn’t hold any major surprises.

Data showed the city-state’s inflation for last month came in better that forecast, while industrial production lagged expectations.

Mizuho Bank said in a note that both sets of data “are not expected to be catalysts for Singapore dollar swings,” adding that the currency “was impacted by some of the noise and volatility from euro swing.”

The euro was flat after it gave up some ground last week when Catalan separatists won a regional election, deepening Spain’s political crisis. — Reuters

RELATED ARTICLESMORE FROM AUTHOR