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EM ASIA FX-Rupiah, won lead Asia FX lower despite easing Syria tension
September 11, 2013 / 5:18 AM / 4 years ago

EM ASIA FX-Rupiah, won lead Asia FX lower despite easing Syria tension

* Rupiah near 4-1/2-yr low on corp dollar demand
    * Won slides on intervention caution, importers
    * Philippine peso turns lower on corp dlr bids

 (Adds text, updates prices)
    By Jongwoo Cheon
    Sept 11 (Reuters) - The Indonesian rupiah and the South
Korean won led slides among emerging Asian currencies on
Wednesday as investors booked profits from gains in regional
units and stock markets earlier in the week.
    The rupiah hovered near its weakest in 4-1/2 years on
sustained dollar demand from local companies.
    The won fell on increasing caution over possible
intervention by the foreign exchange authorities.
    The Philippine peso and the Malaysian ringgit
, which started the day firmer, also turned weaker.
    Earlier, most emerging Asian currencies advanced on signs
that the United States is moving away from taking military
action against Syria after a diplomatic initiative from Russia.
    But regional units came under pressure as 10-year U.S.
Treasury note yield rose to 2.9718 in Asian trading.
MSCI's broadest stock index of Asia-Pacific shares outside Japan
 also turned lower.
    "Higher U.S. yields are not helping Asian currencies and we
have negative equity market sentiment throughout the region,"
said Jonathan Cavenagh, a senior FX strategist at Westpac in
Singapore.
    "We could see more profit-taking but we need to see a
catalyst for dollar/Asia to significantly move higher," Cavenagh
said.
    Emerging Asian currencies could weaken much further if the
10-year U.S. note yield rises above 3.00 percent, he added.
    Most regional units rose earlier this week as investors
covered short positions after weaker-than-expected U.S. jobs
data and solid Chinese economic indicators.
    
    RUPIAH
    Spot rupiah indicative prices lost as much as 2.3 percent to
11,475 per dollar on corporate demand for the greenback. That
compared with 11,500, its weakest since April 2009, hit on
Tuesday.
    Forwards market pointed to more weakness with one-month
deliverable forwards weakening to 11,560.
    Still, the Indonesian currency cut some of initial losses on
equity-linked inflows and as 5- and 10-year bond yields
  fell.
    
    WON
    The won slid as offshore funds and local importers bought
dollars after South Korea's foreign exchange authorities were 
spotted intervening on Tuesday to stem its upside.
    Foreign investors continued to buy Seoul stocks, but
a lack of exporters' demand put pressure on the won, traders
said.
    "The 1,080 resistance is seen getting stronger and that
caused more people to add dollar long positions, although it
would be a key if we see more stock inflows," said a foreign
bank trader in Seoul, referring to the won's value against the
dollar.
    
    RINGGIT
    The ringgit initially rose as investors continued to cover
short positions.
    But it turned weaker on dollar demand from custodian banks
and as it faces a chart resistance area around 3.2600 per
dollar, traders said.
    Local importers also purchased the greenback for settlements
around that level, according to traders.
    "The resistance at 3.26 is pretty clear," said a senior
Malaysian bank trader in Kuala Lumpur, adding he would buy the
ringgit only when it strengthens past the line for a target of
3.2400.
    "I want to be long dollar going into FOMC next week," he
said, referring to the Federal Open Market Committee meeting on
Sept. 17-18.
    Meanwhile, the ringgit found some relief from data showing
the country's industrial output in July grew at its fastest pace
since May 2012. 
    
    PHILIPPINE PESO
    The peso started the local trade at a session high of 43.65
per dollar, its strongest since Aug. 16.
    Investors covered short positions which they had built up on
expectations that the Philippine currency may have not
strengthen past 43.80, traders said.
    But the peso failed to stay on the black on dollar demand
from local companies and as traders covered short positions in
the greenback.
    "The peso might see some resistance at 43.60," said a
foreign bank trader in Manila.
    "With the FOMC next week, I don't think people would hold on
to big dollar short positions."
    
  CURRENCIES VS U.S. DOLLAR   
  Change on the day at 0450 GMT
  Currency    Latest bid   Previous day    Pct Move
  Japan yen       100.48         100.38       -0.10
  Sing dlr        1.2700         1.2685       -0.12
  Taiwan dlr      29.769         29.760       -0.03
  Korean won     1087.90        1084.10       -0.35
  Baht             32.15          32.15       +0.00
  Peso             43.86          43.83       -0.07
  Rupiah        11475.00       11210.00       -2.31
  Rupee            64.10          63.84       -0.40
  Ringgit         3.2780         3.2770       -0.03
  Yuan            6.1199         6.1200       +0.00
 
  Change so far in 2013
  Currency    Latest bid  End prev year    Pct Move
  Japan yen       100.48          86.79      -13.62
  Sing dlr        1.2700         1.2219       -3.79
  Taiwan dlr      29.769         29.136       -2.13
  Korean won     1087.90        1070.60       -1.59
  Baht             32.15          30.61       -4.79
  Peso             43.86          41.05       -6.41
  Rupiah        11475.00        9630.00      -16.08
  Rupee            64.10          54.99      -14.21
  Ringgit         3.2780         3.0580       -6.71
  Yuan            6.1199         6.2303       +1.80
 
    

 (Additional reporting by KyoungHo Lee in SEOUL and IFR Markets'
Catherine Tan; Editing by Kim Coghill)

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