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Asian emerging market currencies struggled on Monday against a broadly stronger dollar as investors bet an attack on former U.S. President Donald Trump boosted chances of his re-election in November, stoking fears of instability.

The prospect of Trump’s return to the White House after the attack is intensifying investors’ worries that his hawkish trade policy, loose regulation and fiscal plans, and potential tax cuts could fan inflation and push back rate cuts. The dollar was last trading at 104.270 against a basket of major currencies.



While cash U.S. Treasuries were untraded in Asia due to a holiday in Japan, the 10-year Treasury futures trended lower.

[USD/] “I see the odds of the Trump trade getting reinforced over the next few months till November, unless the Democrats can come up with a really credible alternative,” said Hemant Mishr, chief investment officer at S Cube Capital in Singapore. “I would bet on high growth, high inflation trades – financials and energy to do well, and negative for Asian currencies.” The South Korean won fell as much as 0.

6% to its lowest since early July, while the Thai baht and the Philippine peso lost 0.4% and 0.3%, respectively.

The Indonesian rupiah declined 0.3% after an eight-day rally until last Friday, ahead of the central bank’s monetary policy meeting on Wednesday. “The weakness in the rupiah today is likely after the strong payback it has had over the month of June over concerns of potential fiscal slippage under.

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