Asian currencies strengthened on Wednesday amid the continued weakening of the do Asia-Pacific currencies rise amid weak US dollar

llar. The Australian dollar showed the strongest performance, rising to a three-year high. The Japanese yen also continued to rise after Prime Minister Sanae Takaichi's decisive victory in the lower house elections.

The Chinese yuan traded around 6.91 per dollar, remaining close to its lowest levels since May 2023. The currency's reaction to January inflation data was muted. The consumer price index rose less than expected, while the producer price index fell for the 40th consecutive month, confirming continued deflationary pressure.

Meanwhile, the dollar continued to decline ahead of the release of key US macro data. The dollar index lost 0.1-0.2%. Pressure was intensified by weak retail sales. Investors are now awaiting the employment report and inflation data, which may adjust expectations for the Fed's rate.