Asian Foreign Exchange Rates Have Steadied But Fear Of Recession Still Looms Around

In Friday’s trading session, the trading prices of the majority of the Asian currencies moved upward.

Despite the trading prices of the Asian currencies moving in the upward zone, it wasn’t a promising sight for the entire week.

The data shows that the Asian currencies did experience a surge on Friday. Still, the overall losses faced by the Asian FX were stronger than the positive performance demonstrated on the week’s last trading day.

Recession Fears are Growing Stronger

The reason behind the overall weekly dips in the FX markets is due to the growing fears of recession across the board.

Although the countries are making efforts to deal with the rising inflation rates, they are not able to evade the recession rates. The global economy is constantly moving towards a worldwide recession.

Even the central banks and the Feds from overall the world have started to point toward a worldwide recession that will hit in the year 2023.

Having such fears, the traders are now focused on accumulating and saving their funds. They want to invest in assets that are able to make it through difficult times.

They are preparing for the worst-case scenario and which means that they will be spending less money on the forex and stock markets.

Global Economy is Growing Weaker

Since the beginning of 2022, the entire world is facing the downward pressure that has been building on the global economy.

Finally, the global economy has started to witness the major impact that the pandemic has caused on the entire world. Then there is the ongoing battle between Russia and Ukraine that has continued for far too long.

What started with heated arguments and disagreements between the foreign ministries of the two countries has now turned into an all-out war.

Both countries are at each other’s throats but Russia is one of the strongest armies in the entire world. The armaments and the war equipment it has is far superior to the Ukrainian army.

Russia already invaded Ukraine back in February and despite the pressure coming from the west, the country has not budged. It has not ordered its army to evacuate which has made the matters worse.

As a result, the global economy is being heavily impacted as there are energy and other kinds of food products crises all over the world.

Supply chain disruptions are also becoming a major problem across the globe, which is dragging the global economy downwards.

With the inflation rates rising, countries are increasing the interest rates to fight it off. However, it seems to be something that cannot be fixed for the long term now.

Despite the efforts, the inflation rates are still on the rise pushing the Feds and the central banks to grow more hawkish towards the interest rates.

This is what has become the cause of pushing the global economy into recession.

This means that the global economy and the forex markets will end up facing a downtrend in the year 2023. However, for now, it is important to look at the performance of the Asian currencies from Friday’s session.

Performance of the Asian Currencies

Among the Asian fiat currencies, the Japanese yen has emerged as the top gainer, having surged by 0.5% against the dollar.

Despite the surge, the overall dip the yen has incurred in the entire week is 0.5%, meaning its performance will remain flat this week.

The value of the Chinese yuan has risen 0.1% against the dollar on Friday but its overall loss in the running week has been 0.2%.

The value of the Singapore dollar has also experienced a 0.3% surge but its weekly growth is expected to remain flat.

The Thai baht remained flat on Friday but its overall dip throughout the week was at 1.2%. The Indian rupee ended up losing 0.5% throughout the week and Friday’s performance was flat.