Global Currencies React as Economic Uncertainty Looms

The Australian dollar hit a four-month low due to weak economic growth, raising expectations for interest rate cuts. South Korea's won stabilised after a martial law scare, while the Chinese yuan made slight gains. The U.S. dollar recovered against rivals as traders anticipated further economic cues.

The Australian dollar plunged to a four-month low on Wednesday following disappointing economic growth figures, which heightened anticipation for imminent interest rate cuts. Concurrently, South Korea's won steadied after a potential martial law situation was diffused, while the Chinese yuan attempted to distance itself from recent lows.

In contrast, the U.S. dollar bounced back from recent dips against major currencies, with traders eagerly awaiting labor market data for insights into future Federal Reserve actions. Despite looming political instability in France, the euro maintained its position, surpassing a recent two-year low.

The market saw a significant 96% expectation for a rate cut in Australia by April, while the South Korean won faced uncertain prospects due to domestic economic weaknesses and political tensions. Meanwhile, the dollar benefited from stable job openings data in the U.S., bolstering its stance globally.

(With inputs from agencies.)