World Currencies
World CurrenciesREUTERS

Asian currencies such as the Chinese yuan, the Indian rupee, the Malaysian ringgit, the Thai baht and the Indonesian rupiah have weakened as upbeat US growth data helped the dollar remain strong despite a balanced policy statement from the Federal Reserve.

The dollar, based on a trade-weighted index that measures its strength against six major currencies, rose to a 10-month high after the second quarter GDP numbers surprised on the higher side.

Even though there was no clear indication of a sooner rate hike in the FOMC statement that came shortly after the GDP data, it was hawkish enough to limit the correction in the greenback to marginal levels.

The dollar index rallied to 81.54 on 30 July, its highest since mid-September 2013, and about 2.2% higher in the month. It had eased to 81.40 levels on Thursday.

The US economy expanded 4% on an annualised basis in Q2, after contracting 2.1% in Q1, while analysts were expecting a growth of 3%, as per the data released on 30 July at 12:30 GMT.

The dollar index and major pairs could react to the US data on Wednesday, but the Asian units had that opportunity only the next day.

"Information received since the Federal Open Market Committee met in June indicates that growth in economic activity rebounded in the second quarter. Labour market conditions improved, with the unemployment rate declining further," the Fed statement released at 18:00 GMT showed.

"However, a range of labour market indicators suggests that there remains significant underutilisation of labour resources."

The Thai baht weakened to 32.045 against the US dollar on Thursday a 10-day low, from the previous close of 31.925 and nearly 1% down from the eight-month high of 31.725 touched on 23 July.

The Malaysian ringgit dropped to a 14-day low of 3.1905 from 3.1840 at Wednesday's close and is now 0.8% weaker from the near eight-month high of 3.1652 touched on 10 July.

The Indian rupee fell to 69.29 from the previous close of 60.0750. The rupee is set to end the second straight month lower after touching an 11-month high of 58.23 in May. Over the past two months, it has fallen 3.4%.

The Indonesian rupiah also showed weakness. The USD/IDR pair has been holding a tight range of 11,575-11,625 for the past four trading sessions, off a two-month low of 11,474 touched on 22 July.

The Chinese yuan's rise against the dollar, marking the seventh consecutive day of gains on Wednesday, was arrested by the dollar move on Thursday. The USD/CNY that fell to a 4-1/2-month low of 6.1717 on Wednesday held a range of 6.1717-6.1767 on Thursday.

After gaining ground in May, the yuan has completed a third straight month of gains. It is up 1.5% from the 17-month low of 6.2672 touched in April.