* Some Asian currencies slip in wake of Yellen's testimony
* But positive risk sentiment seen supporting EM Asia FX
* Taiwan dollar hits highest since May 2015
(Adds text, updates prices)
SINGAPORE, Feb 15 Some emerging Asian currencies
edged lower on Wednesday after Federal Reserve Chair Janet
Yellen's comments on the monetary policy outlook were seen as
more hawkish than expected, boosting the dollar.
But losses in Asian currencies were mild, with the South
Korean won slipping 0.4 percent on the day in onshore
trade after climbing 1.2 percent on Tuesday.
The Thai baht and the Philippine peso
eased 0.1 percent.
The Taiwan dollar outperformed and touched a high of 30.704
against the greenback, its strongest level since May
U.S. dollar selling by life insurance firms for FX hedging
purposes was cited as a factor behind the Taiwan dollar's
Emerging Asian currencies were supported by positive risk
sentiment, with MSCI's broadest index of Asia-Pacific shares
outside Japan, touching a 19-month high.
The outcome of the recent U.S.-Japan summit, together with
receding concerns about U.S.-China political tensions after the
White House said last week that President Donald Trump agreed to
honour the U.S. "One China" policy, are supporting underlying
risk sentiment, said Roy Teo, senior FX strategist for ABN AMRO
That is helping to make emerging Asian currencies "a bit
more resilient" despite the likelihood of the Fed raising
interest rates in the next few months, Teo said.
Yellen's testimony to Congress on Tuesday helped bolster
such expectations and gave the dollar a lift.
She said delaying rate increases could leave the Fed's
policymaking committee behind the curve, adding that the U.S.
central bank will likely need to raise interest rates at an
Gains in Taiwan equities, which have attracted foreign
investor inflows this year, have been a driver behind the recent
strength in the Taiwan dollar, said Mingze Wu, FX trader of
global payments for financial services provider INTL FCStone Ltd
With it recent gains, the Taiwan dollar is nearing a test of
its May 2015 high of 30.394 per U.S. dollar.
The Taiwan dollar will probably have a hard time rising
beyond that 2015 peak, said Kota Hirayama, senior economist for
SMBC Nikko Securities in Tokyo, adding that Taiwanese
authorities may see the local currency's recent strength as
"I don't get the sense that they will tolerate further
strength in the Taiwan dollar against the currencies of other
(trade) competitors," Hirayama said.
The Taiwan dollar touched its highest level against the
Japanese yen since December 2015 on Wednesday.
The Taiwan dollar has also risen against the South Korean
won in recent months and is up 5.5 percent since the
end of September.
CURRENCIES VS U.S. DOLLAR
Change on the day at 0723 GMT
Currency Latest bid Previous day Pct Move
Japan yen 114.55 114.27 -0.24
Sing dlr 1.4215 1.4204 -0.08
Taiwan dlr 30.735 30.868 +0.43
Korean won 1140.79 1137.40 -0.30
Baht 35.02 34.97 -0.14
Peso 49.935 49.880 -0.11
Rupiah 13328 13328 +0.00
Rupee 66.95 66.92 -0.04
Ringgit 4.4470 4.4480 +0.02
Yuan 6.8703 6.8660 -0.06
Change so far in 2017
Currency Latest bid End prev year Pct Move
Japan yen 114.55 117.07 +2.20
Sing dlr 1.4215 1.4490 +1.93
Taiwan dlr 30.735 32.279 +5.02
Korean won 1140.79 1207.70 +5.87
Baht 35.02 35.80 +2.24
Peso 49.94 49.72 -0.43
Rupiah 13328 13470 +1.07
Rupee 66.95 67.92 +1.46
Ringgit 4.4470 4.4845 +0.84
Yuan 6.8703 6.9467 +1.11
(Reporting by Masayuki Kitano in Singapore; Additional
reporting by Reuters FX analyst Ewen Chen; Editing by Jacqueline