Anna 
On Wednesday, most Asian currencies saw a decline, with the Chinese yuan touching its lowest level in six months amidst ongoing concerns about elevated U.S. interest rates, which kept traders inclined towards the dollar.
Sentiment towards risk-driven regional markets remained subdued, particularly as hawkish statements from the Federal Reserve continued to emerge. Worries over sluggish regional economic growth further added to the prevailing apprehension.
Both the dollar index and dollar index futures recorded a 0.1% increase in Asian trade, extending their gains from the previous day following remarks by Minneapolis Fed President Neel Kashkari, who suggested that policymakers had not dismissed the possibility of additional rate hikes to address inflation.
Kashkari’s comments arrived just ahead of the highly anticipated release of the closely watched PCE price index data, serving as the Fed’s preferred measure of inflation.
Meanwhile, the Chinese yuan weakened as the People’s Bank of China set a softer midpoint fix, leading the USDCNY pair to its highest level since mid-November. While the PBOC has been maintaining a firm control over the yuan to curb its depreciation, recent developments indicate a slight relaxation of this stance amid sustained selling pressure on the yuan and economic fragility in China.
Despite Beijing’s efforts to bolster the property market through supportive measures, doubts persist among traders regarding the execution and funding of such stimulus initiatives, particularly given the sector’s prolonged downturn spanning over three years.
