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EM ASIA FX-Dollar's retreat supports Asia FX, Yellen awaited
May 26, 2016 / 4:56 AM / a year ago

EM ASIA FX-Dollar's retreat supports Asia FX, Yellen awaited

* Ringgit gains on oil, traders cover bearish bets
    * Rupiah up on bonds; Indonesia c.bank flags June rate cut
    * Taiwan dollar hits 2-week high on equity inflows
    * Yuan edges up as PBOC sets strong midpoint

 (Adds text, updates prices)
    By Jongwoo Cheon
    SINGAPORE, May 26 (Reuters) - Most emerging Asian currencies
rose on Thursday as the dollar broadly eased ahead of U.S.
Federal Reserve chief Janet Yellen's speech, causing investors
to unwind some of their bearish bets on regional units against
the greenback.
    The Malaysian ringgit led regional gains as higher
crude prices eased concerns over the country's falling oil and
gas revenues.
    Indonesia's rupiah advanced on higher government
bond prices after the central bank governor on Wednesday
indicated that another rate cut was possible in June.
 The Taiwan dollar hit a two-week high on
stock inflows.
    The Chinese yuan edged up as the central bank set
its daily guidance rate firmer. 
    The U.S. dollar retreated from a near two-month peak
against a basket of six major currencies as investors awaited
Yellen's remarks on Friday for clues on whether a rate hike is
imminent.
    "It is a time to take profits from the recent dollar's
strength," said Jeong My-young, Samsung Futures research head in
Seoul. "Emerging currencies also received some comfort as oil
prices rose despite a strong dollar."
    
    RINGGIT
    The ringgit found more support as traders covered bearish
bets in the currency on the greenback's broad weakness.
    The Malaysian currency's appreciation accelerated once it
strengthened past 4.1000 per dollar, traders said.
    "Investors may need to cut some more long dollar positions,
probably another 0.3 to 0.5 percent as the market is now trading
'risk-on'," said a senior Malaysian bank trader in Kuala Lumpur.
    
    RUPIAH
    The rupiah advanced, tracking rises in most government bond
, especially long-dated debt.
    Bank Indonesia Governor Agus Martowardojo said on Wednesday
the central bank may ease monetary policy again next month, in a
sign that policy makers are keen to stoke a slowing economy
despite risks of capital outflows from the Fed's rate hike.
    The official Jakarta Interbank Spot Dollar Rate,
which the central bank introduced in 2013 to manage exchange
rate fluctuations, was fixed at 13,615, stronger than the
previous 13,671.
    
    TAIWAN DOLLAR
    The Taiwan dollar gained 0.3 percent to 32.550 per dollar,
its strongest since May 12.
    Foreign financial institutions bought the island's currency,
probably to purchase local equities, currency traders said.
Foreign investors were net buyers of Taiwan's stocks on
Wednesday.
    Still, exporters were on the sidelines even with the end of
May approaching, expecting further weakness in the Taiwan
dollar.
    Exporters' demand for settlements usually strengthens around
month-end.
   
    CURRENCIES VS U.S. DOLLAR
    Change on the day at 0420 GMT
  Currency                 Latest bid   Previous day  Pct Move
  Japan yen                    109.69         110.19     +0.46
  Sing dlr                     1.3770         1.3779     +0.07
  Taiwan dlr                   32.558         32.652     +0.29
  Korean won                  1182.90        1182.50     -0.03
  Baht                          35.63          35.70     +0.18
  Peso                         46.680         46.785     +0.22
  Rupiah                        13605          13650     +0.33
  Rupee                         67.35          67.33     -0.02
  Ringgit                      4.0800         4.1035     +0.58
  Yuan                         6.5565         6.5604     +0.06
                                                              
  Change so far in 2016                                       
  Currency                 Latest bid  End prev year  Pct Move
  Japan yen                    109.69         120.30     +9.67
  Sing dlr                     1.3770         1.4177     +2.96
  Taiwan dlr                   32.558         33.066     +1.56
  Korean won                  1182.90        1172.50     -0.88
  Baht                          35.63          36.00     +1.04
  Peso                          46.68          47.06     +0.81
  Rupiah                        13605          13785     +1.32
  Rupee                         67.35          66.15     -1.77
  Ringgit                      4.0800         4.2935     +5.23
  Yuan                         6.5565         6.4936     -0.96
 
 (Additional reporting by Loh Liang-sa in TAIPEI; Editing by
Jacqueline Wong)

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