Most Asian currencies were little changed on Wednesday as they rolled into the year-end in a shabby state, with global growth risks and political uncertainty in the US leaving little chance of a strong near-term recovery. The likelihood of a prolonged partial US government shut-down and President Donald Trump's scathing criticism of the Federal Reserve's steady rate increases drove investors away from risk-sensitive assets.

Qi Gao, Asia FX strategist at Scotiabank in Singapore, said investors were cautious after Trump's latest broadside against the Fed and US Treasury Secretary Steven Mnuchin's move to convene a crisis group in an attempt to calm investors in the wake of big stock market losses.

Many of the regional currencies hugged tight ranges, reflecting a combination of low year-end volumes and reluctance to make big bets in the face of deepening gloom over global growth, trade and investment. The bitter Sino-US trade war has also taken the sheen away from currencies of export-dependent economies such as Taiwan and South Korea.

All of this as well as capital-outflow fears have left a majority of the regional units carrying sizeable losses into the year-end. The Singapore dollar and Malaysian ringgit both firmed 0.1 per cent, while the Korean won was flat. The Indian rupee advanced as much as 0.5 per cent and was the best performer after a more than 6 per cent plunge in oil prices on Wednesday - a boon to India's economy, which is a net oil importer. We remain bullish on the rupee in the current stage not only because of oil prices but also because of RBI’s (Reserve Bank of India) open market operations that inject additional liquidity,” Gao said.

Elsewhere, the Indonesia rupiah slid 0.3 per cent, the most among regional currencies. The rupiah has managed to cut some of the heavy losses suffered this year, thanks to Bank Indonesia's aggressive monetary policy tightening, plunging oil prices and a softening outlook for the US Federal Reserve's tightening path.

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