(Feb 18): Asian currencies eased on Tuesday, with the Indonesian rupiah and the Philippine peso losing the most, as traders weighed the risk of a major global tariff war and reassessed the trajectory of US interest rates.

The peso and the Malaysian ringgit declined by 0.4% each, while the rupiah was set for its worst day since February 10, slipping 0.4% after a four-session rally.

The dollar index rose by 0.2% to 106.9 after a three-session losing streak amid uncertainty over US President Donald Trump's tariff plans.

The greenback was bolstered by Federal Reserve governor Christopher Waller's support for maintaining current monetary policy until inflation eases, after data showed US consumer prices rose at their fastest rate in nearly 18 months in January.

"Markets have been positioning for tariff trade (ie long USD), but the repeated delays in Trump tariffs have frustrated USD bulls thus far," said Christopher Wong, a currency strategist at OCBC.

However, the delays to US tariffs, peace negotiations over Ukraine, underperforming US economic indicators such as retail sales, and a reassessment of Chinese tech stocks due to initiatives like DeepSeek are creating a favourable environment for risk assets to recover while the dollar retreats, Wong said.

Indonesia's central bank is widely expected to hold rates steady on Wednesday to curb weakness in the currency, according to a Reuters poll, suggesting global headwinds could limit the central bank's ability to ease rates this year.

The rupiah has fallen more than 1% since the start of the year.

The peso has extended losses since governor Eli Remolona's comments on uncertainities over global trade policies on Thursday.

The Singapore government started presenting its budget at 0730 GMT. The Singapore dollar fell 0.2%, while equities were up 0.4%.

The Thai baht extended losses and was last down 0.2%, after data showed that the country's economy grew more slowly than expected in 2024.

Equities in Manila and Jakarta were up 1.8% and 0.9%, respectively.

Uploaded by Magessan Varatharaja