Investing.com– Most Asian currencies were trading in low or flat territory on Friday, with the Chinese yuan swinging wildly on concerns about intervention by the People’s Bank of China while the dollar steadied ahead of key inflation data.

Weak risk appetite kept traders wary of most regional currencies this week, while the Japanese yen saw increased buying as it benefited from demand for safe-havens, while an unwinding carry trade also benefited the currency. The yen was by far the best performer among its Asian peers this week.

Commodity-linked currencies, particularly those exposed to China, saw some relief on Friday, with the Australian and New Zealand dollars gaining slightly. However, both have posted gigantic losses this week.

Dollar steady after mighty GDP; inflation, Fed in focus

The indicators stabilised on Friday after some signs of resilience emerged following better-than-expected second-quarter data.

The reading raised hopes that the US economy was heading for a tender landing, meaning economic growth would remain stable and inflation would fall.

Now, attention turns to the Fed’s preferred inflation indicator, which is due Friday and is expected to see inflation fall even further in June.

The PCE data also comes just days before , where the central bank is widely expected to keep rates on hold. However, any signs of a rate cut will be closely watched, with markets keeping expectations of a September cut intact.

Chinese yuan sees pointed fluctuations after suspected intervention

The Chinese yuan weakened on Friday, retreating after suspected Chinese government intervention sent the currency soaring against the dollar on Thursday.

The pair fell sharply from near eight-month highs on Thursday, with its massive decline prompting speculation about government intervention. The currency has been facing increased selling pressure following a series of surprise rate cuts by the PBOC this week.

Doubts about a slowdown in the economic recovery also weighed on the yuan.

Japanese Yen Performs Better, BOJ Expected

The Japanese yen was among the best-performing currencies this week, continuing a mighty run after suspected intervention by Tokyo in early July helped boost the currency.

The currency pair fell 2.4% this week – its biggest weekly decline since slow April.

However, the yen’s gains were tempered somewhat by the , which showed that inflation remained relatively low in July.

The delicate inflation reading came just days before , and analysts were divided on whether the central bank would have enough leeway to raise rates by 10 basis points.

Broader Asian currencies have mostly posted gigantic losses against the dollar this week as risk appetite has soured. The Australian dollar and New Zealand dollar pair are down almost 2% this week.

The Indian rupee stabilised after intervention by the Reserve Bank of India helped it move away from record levels hit on Thursday.

The South Korean won rose 0.3% while the Singapore dollar was unchanged after the Monetary Authority of Singapore left its monetary policy unchanged.