Investors Boost Bullish Bets on Asian Currencies as U.S. Dollar Wobbles

A Reuters poll showed that investors have significantly increased their long positions in Asian currencies—including the Chinese yuan, Taiwanese dollar, and Philippine peso—driven by easing U.S.-China trade tensions, fresh trade deals, and growing concerns over U.S. fiscal and tariff policies.

Yuan Bulls Return in Force

Long wagers on the Chinese yuan reached their highest level since October 2023, as renewed dialogue between Washington and Beijing lifted confidence. The yuan has already gained 1% this month, reflecting optimism that a sustained reduction in tariff uncertainty will support further appreciation.

To track the yuan's daily moves alongside other Asian FX pairs, consult the Forex Daily API, which provides real-time cross-currency rates and volume data essential for gauging market sentiment.

Record-High Positioning in Regional Peers

Investors' net long positions in:

• Taiwanese dollar and Philippine peso climbed to their highest since late 2020,

• South Korean won and Thai baht also saw substantial bullish inflows.

These shifts underscore a broader trend of dollar diversification, as traders seek to reduce U.S. asset exposure amid worries over proposed tax cuts and the ballooning fiscal deficit.

Tariff Ruling Sparks Dollar Sell-Off

The poll was conducted before the U.S. Court of International Trade struck down President Trump's sweeping reciprocal tariffs—ruling he had exceeded his authority. This decision quelled some trade-policy fears and added to the dollar's decline, further boosting Asian currency longs.

Keep an eye on upcoming trade-policy events and court-appeal timelines—key drivers for FX volatility—using the Economics Calendar API, which highlights hearings, tariff deadlines, and major central bank meetings.