EM ASIA FX-Peso down after c.bank tightens liquidity rules

SINGAPORE, July 9 (Reuters) - The Philippine peso slid on
Monday after the central bank tightened liquidity rules to
tackle currency speculation and most emerging Asian currencies
fell on weak U.S. jobs data.
On Saturday, the Bangko Sentral ng Pilipinas said it had
toughened the rules on its short-term special deposit instrument
that has attracted 1.7 trillion pesos ($40.66 billion) in funds.

Philippine authorities have expressed concern that foreign
funds may have been taking advantage of the higher rates being
offered by the special deposit account (SDA) facility,
introduced by the central bank in 1998 to help manage liquidity
in the financial system.
The peso eased 0.2 percent against the dollar on early
Monday with some interbank players selling the Philippine
currency, but its depreciation was smaller than that of the
Malaysian ringgit and the Indonesian rupiah.
Manila's measures "may have some impact on inflows to
Philippines, given that SDA pays above treasury bills," said
Enrico Tanuwidjaja, a currency strategist at Maybank in
Singapore.
"But people are still positive on the peso compared to other
regional FX and they may look into other ways to get more peso
exposures," he said. "If equity does not see a major sell-off
because of the global easing signs, we remain positive on the
peso compared to the rest."
Manila stocks dropped 0.7 percent, while MSCI's
broadest index of Asia-Pacific shares outside Japan
was down 0.8 percent.
Tanuwidjaja recommended investors buy the peso against the
ringgit, the rupiah and the Thai baht.
Other analysts and dealers shared his positive view on the
peso.
"In the longer term, we see the peso as a darling right now.
In risk-off mode, it does not swing. But in risk-on mode, it is
reactive," said a European bank dealer in Singapore, who
predicted it "will continue to be an outperformer this year."
The peso, helped by inflows, has been the best performer
among emerging Asian currencies this year, gaining 4.7 percent
against the dollar.
On Monday, regional units reacted to data on Friday showing
U.S. employers added 80,000 new jobs in June, below 90,000
forecast. While the data was seen as not strong enough to prompt
any immediate action, it boosted the chances of the Federal
Reserve launching a new round of monetary stimulus to boost
growth, a poll showed.

CURRENCIES VS U.S. DOLLAR
Change on the day at 0200 GMT
Japan yen 79.56 79.67 +0.14
Sing dlr 1.2706 1.2711 +0.04
Taiwan dlr 29.912 29.922 +0.03
Korean won 1140.80 1137.80 -0.26
Baht 31.69 31.64 -0.16
Peso 41.88 41.79 -0.21
Rupiah 9420.00 9380.00 -0.42
Rupee 55.40 55.42 +0.04
Ringgit 3.1850 3.1730 -0.38
Yuan 6.3708 6.3644 -0.10

Change so far in 2012
Currency Latest bid End prev year Pct Move
Japan yen 79.56 76.92 -3.32
Sing dlr 1.2706 1.2969 +2.07
Taiwan dlr 29.912 30.290 +1.26
Korean won 1140.80 1151.80 +0.96
Baht 31.69 31.55 -0.44
Peso 41.88 43.84 +4.68
Rupiah 9420.00 9060.00 -3.82
Rupee 55.40 53.08 -4.19
Ringgit 3.1850 3.1685 -0.52
Yuan 6.3708 6.2940 -1.21
($1 = 41.8050 Philippine pesos)
(Reporting by Jongwoo Cheon; Editing by Richard Borsuk)

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