Asia FX tepid, dollar firms as traders weigh impact of fresh Trump tariffs

Most Asian currencies traded in tight ranges on Tuesday while the U.S. dollar remained resilient, as investors weighed the fallout from fresh U.S. tariff measures.

The US Dollar Index firmed 0.2% in Asian hours after closing largely flat overnight, having pared earlier losses.

US Dollar Index Futures also traded 0.2% higher as of 23:54 ET (04:54 GMT).

Traders weigh Trump tariff impact

Market participants remained cautious, with risk appetite constrained by uncertainty over the durability and scope of new import duties.

U.S. President Donald Trump announced a 15% global tariff on imports following a ruling by the U.S. Supreme Court that struck down an earlier emergency tariff programme.

Trump also warned that countries attempting to “play games” in negotiating trade deals could face steeper levies, reinforcing concerns that global trade tensions may intensify again.

The renewed tariff push kept regional currencies subdued, particularly in export-reliant economies that are sensitive to shifts in global demand and supply chains.

"We as such continue to think that countries will by and large honour trade deals, even as some may take a pause to reassess the situation," MUFG analysts said in a note.

The Japanese yen weakened modestly against the dollar, with the USD/JPY pair rising 0.4% amid tempered expectations for imminent policy tightening from the Bank of Japan.

Elsewhere, moves were largely muted, with the South Korean won's USD/KRW pair gaining 0.1%.

The Singapore dollar's USD/SGD pair ticked 0.1% higher, while the Indian rupee's USD/INR traded flat.4

The Australian dollar's AUD/USD pair gained 0.1%.

China keeps loan prime rate steady

The Chinese yuan's onshore USD/CNY pair edged 0.2% lower on Tuesday.

The People's Bank of China left its one-year and five-year loan prime rates unchanged, in line with expectations.

The steady policy stance underscored Beijing’s preference for measured support as it balances growth stabilization with financial risk control.

Chinese financial markets reopened on Tuesday after the Lunar New Year holiday.