Asian currencies gained slightly on Monday as the US dollar continued to retreat after President Trump announced a delay to the 50% tariffs on EU imports from June 1 to July 9. The Chinese yuan rose to a six-month high, while other currencies in the region experienced modest upward movements amid ongoing trade uncertainties.

Impact of Tariff Delay on Dollar Performance

The US Dollar Index fell by 0.3%, reaching its lowest level in over a month, while Dollar Index Futures reflected this decline. Trump’s delay followed a conversation with European Commission President Ursula von der Leyen, signaling renewed trade discussions and reducing demand for the dollar as a safe-haven asset.

Currency Performance Overview

• USD/JPY: down 0.1%, as traders prepare for trade talks between Tokyo and Washington in early June.

• USD/CNY: decreased by 0.1%, lifting the onshore yuan to its strongest level since November 2024.

• AUD/USD: increased by 0.3%, supported by a more positive risk sentiment and expectations for a dovish central bank response.

• USD/MYR: dropped by 0.5%; other pairs also saw slight decreases.

Even though the dollar’s decline offers some relief, ongoing tariff uncertainties continue to limit the extent of currency appreciation across the region.

Anticipating Future Trade Developments

Traders remain cautious in front of key economic events, such as Japan’s trade discussions in Washington and upcoming Senate votes on tax legislation that could significantly affect the national debt.