Bank of America Merrill Lynch Global Research, in a note, said there's a strong consensus favouring an extension of the 90-day "ceasefire" US President Donald Trump and Chinese President Xi Jinping agreed to on Dec. 1. However, an extension "with little meaningful progress may now disappoint", it said. Uncertainty on the talks' outcome, coupled with concerns on global growth, kept the safe haven dollar near its 2019 high, following an 0.45 percent jump on Monday.
Pressured by strength of the dollar and higher oil prices the Indonesian rupiah dropped as much as 0.3 percent, the day's biggest drop for a regional currency, before paring the loss to 0.1 percent. The Malaysian ringgit and Taiwan dollar both dipped 0.1 percent.
The Philippine peso firmed 0.2 percent after reporting the trade deficit narrowed to a three-month low in December as imports tumbled for the first time in a year. The Chinese yuan and Singapore dollar advanced 0.1 percent each. The Indian rupee firmed 0.4 percent ahead of January inflation data due later in the day.
A Reuters poll predicted the inflation rate nudged up slightly but remained below the central bank's target for a sixth straight month. DBS Group Research, in a note, said the central bank signalled last week that "benign headline inflation, rather than elevated core, was the key mandate and in so far as prints remain below the target, the panel will have the space to take a growth supportive stance". The Reserve Bank of India on Thursday unexpectedly lowered interest rates and, as anticipated, changed its policy stance to "neutral" to boost a slowing economy.