December 20, 2016 / 6:25 AM / 8 months ago

EM ASIA FX-Ringgit hits lowest since 1998, Asia FX dented by Fed outlook

(Adds text, updates prices)
    * Ringgit hits lowest vs dollar since January 1998
    * Singapore dollar hits 7-year low, later turns higher
    * Won hits 6-1/2 month low; baht hits lowest in nearly 11
months

    By Masayuki Kitano
    SINGAPORE, Dec 20 (Reuters) - The Malaysian ringgit slipped
to its weakest level in nearly 19 years versus the dollar on
Tuesday as prospects of a faster pace of U.S. interest rate
rises in 2017 kept the greenback well bid.
    The ringgit fell to 4.4790  per dollar as of
0556 GMT, its weakest level since January 1998, during the Asian
financial crisis. It last stood at 4.4780, little changed on the
day.
    The Singapore dollar hit a seven-year low of 1.4507 per U.S.
dollar. It later turned higher, however, with market
participants citing suspected U.S. dollar-selling intervention
by Singapore's central bank.     
    The South Korean won and the Thai baht touched multi-month
lows, as downward pressure on Asian currencies persisted after
the U.S. Federal Reserve raised interest rates last week and
signalled three hikes in 2017, more than it had expected
earlier.    
    The won hit a low of 1193.0 per dollar at one
point, its weakest level since early June. The baht fell to 
35.911, its lowest level since late January.
    While financial markets were rattled by deadly incidents in
Turkey and Germany on Monday, analysts said the impact on
emerging Asian currencies seemed to be limited. 
    A truck ploughed into a crowded Christmas market in central
Berlin on Monday evening, killing 12 people and injuring 48
others while the Russian ambassador to Turkey was shot dead as
he gave a speech at an Ankara art gallery. 
 
    The incidents "do not appear to eclipse the optimism over
the U.S. economy," said Philip Wee, senior currency economist
for DBS Bank, adding that comments from Fed Chair Janet Yellen
on Monday reinforced the positive view on the U.S. economy.
    In a speech on Monday, Yellen noted that college graduates
were entering the strongest jobs market in nearly a decade.
    
    Emerging Asian currencies have declined broadly since early
November, as the dollar and U.S. bond yields jumped on
expectations that U.S. President-elect Donald Trump's proposals
for infrastructure spending and tax cuts will boost economic
growth and inflation.
    The rise in U.S. bond yields has stirred worries about the
risk of capital outflows from emerging markets, putting downward
pressure on emerging Asian currencies.
     
    INDONESIAN RUPIAH
    The rupiah slipped 0.1 percent versus the dollar. 
    An Indonesia-based trader said the rupiah was pressured
partly by year-end demand for dollars among local firms.
           
  CURRENCIES VS U.S. DOLLAR  
  Change on the day at   0555 GMT                         
  Currency                   Latest bid   Previous     Pct
                                               day    Move
  Japan yen                      117.65     117.10   -0.47
  Sing dlr                       1.4451     1.4491   +0.28
  Taiwan dlr                     31.977     31.970   -0.02
  Korean won                    1192.30    1186.90   -0.45
  Baht                            35.90      35.87   -0.07
  Peso                           49.980     49.960   -0.04
  Rupiah                          13393      13380   -0.10
  Rupee                           67.89      67.86   -0.04
  Ringgit                        4.4780     4.4765   -0.03
  Yuan                           6.9510     6.9513   +0.00
                                                          
  Change so far                                           
 in 2016                                            
  Currency                   Latest bid   End prev     Pct
                                              year    Move
  Japan yen                      117.65     120.30   +2.25
  Sing dlr                       1.4451     1.4177   -1.90
  Taiwan dlr                     31.977     33.066   +3.41
  Korean won                    1192.30    1172.50   -1.66
  Baht                            35.90      36.00   +0.29
  Peso                            49.98      47.06   -5.84
  Rupiah                          13393      13785   +2.93
  Rupee                           67.89      66.15   -2.56
  Ringgit                        4.4780     4.2935   -4.12
  Yuan                           6.9510     6.4936   -6.58
 
 (Reporting by Masayuki Kitano, additional reporting by IFR
Markets' Catherine Tan)

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