MUFG: Asian Currencies Set to Gain on Growth Gap, AI Exports

MUFG’s Michael Wan argues that Asian currencies are poised to benefit from a widening growth gap between the region and the United States. He highlights that economies heavily tied to artificial intelligence exports—such as South Korea, Taiwan, and Malaysia—are likely to see the most support.

The analyst contrasts the relative strength of these Asian export sectors with the US economic backdrop, which continues to face Federal Reserve rate uncertainty. The divergence in growth trajectories is seen as a key tailwind for regional FX.

While the US dollar remains supported by higher-for-longer interest rate expectations, Wan suggests that Asia’s structural advantages in the AI supply chain could offset some of that drag, keeping currencies like the Korean won, Taiwanese dollar, and Malaysian ringgit on firmer footing.