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EM ASIA FX-Sliding yen, weak China PMI hit Asia FX; Sing dlr up on suspected intervention
November 20, 2014 / 5:32 AM / 3 years ago

EM ASIA FX-Sliding yen, weak China PMI hit Asia FX; Sing dlr up on suspected intervention

* Won near 15-month low; exporters limit losses
    * Intervention spotted to support Singapore dlr -traders
    * S.Korea suspected intervening to check yen/won -traders

 (Adds text, updates prices)
    By Jongwoo Cheon
    SINGAPORE, Nov 20 (Reuters) - Most emerging Asian currencies
fell on Thursday with South Korea's won near a 15-month low as
the yen lost ground and a private survey of China's
manufacturing sector increased worries about a slowdown in the
world's second-largest economy.
    The Singapore dollar bucked the regional trend as
traders said the central bank was suspected of supporting the
currency.
    The won kept underperforming as it is seen more
sensitive to the yen's weakness, given the competition between
South Korea and Japan in exports markets.
    Indonesia's rupiah fell as investors took profits
from its gains after the central bank raised interest rates and
the government increased fuel price earlier this week.
    The yen hit 118.68, a seven-year low against the dollar
 and a six-year trough versus the euro as
speculators rushed to carry trades funded by super-cheap
liquidity from the Bank of Japan.
    Asia ex-Japan shares fell after a private survey showed
growth in China's factory sector stalled in November with output
contracting for the first time in six months. 
    "Most Asian currencies became more sensitive to the yen
after it broke through 115. That indicated a weaker yen is an
obvious strategy for Japan," said Jeong My-young, Samsung
Futures' research head in Seoul.
    "Other Asian countries, especially competitors in exports
markets, are seen following it."
    
    WON
    The won fell 1.0 percent to 1,117.1 per dollar, its weakest
since Aug. 28, 2013, tracking the yen's weakness.
    The South Korean currency pared some of its losses as
exporters chased the unit on dips for month-end settlements.
Some traders covered short positions.
    Still, investors were looking to sell the currency on any
rallies on growing caution over possible intervention by the
foreign exchange authorities to check its strength against the
yen.
    The won advanced to 9.3907 to the Japanese unit, not far
from a six-year high of 9.3800 hit on Tuesday.
    Some traders suspected the authorities of intervening.
    "Despite many dollar offers, dollar/won tried to rebound
whenever it slid. The authorities may have managed," said a
foreign bank trader in Seoul.
    South Korea's top officials repeated concerns over the
impact of the weakening yen on local exporters.
    
    SINGAPORE DOLLAR
    The Singapore dollar rose as the central bank was spotted
intervening to support the currency after it fell to 1.3102 to
the U.S. dollar, its weakest since December 2011.
    Hedge funds and local companies also bought the city-state's
currency.
    OCBC Bank said as per its estimates the Singapore dollar
nominal effective exchange rate (NEER) fell below parity for the
first time since March 2014.
    NEER-implied U.S. dollar/Singapore dollar thresholds are a
tad higher currently with parity estimated at 1.3025, it added.
    "Expect investor caution to prevail in the current vicinity
with participants looking for any hint of a policy signal,"
Emmanuel Ng, a foreign exchange strategist with OCBC, said in a
note to clients.
    The Monetary Authority of Singapore maintained its tight
policy of a "modest and gradual" appreciation of the Singapore
dollar in October. The central bank manages monetary policy by
controlling the exchange rate, rather than borrowing costs,
because trade dominates the economy.
    
    CURRENCIES VS U.S. DOLLAR
    Change on the day at 0440 GMT
  Currency    Latest bid   Previous day    Pct Move
  Japan yen       118.46         117.98       -0.41
  Sing dlr        1.3035         1.3055       +0.15
  Taiwan dlr      30.905         30.876       -0.09
  Korean won     1114.10        1106.30       -0.70
  Baht             32.85          32.81       -0.13
  Peso             45.13          45.07       -0.12
  Rupiah        12175.00       12145.00       -0.25
  Rupee            62.16          61.96       -0.32
  Ringgit         3.3640         3.3600       -0.12
  Yuan            6.1246         6.1198       -0.08
 
  Change so far in 2014
  Currency    Latest bid  End prev year    Pct Move
  Japan yen       118.46         105.28      -11.13
  Sing dlr        1.3035         1.2632       -3.09
  Taiwan dlr      30.905         29.950       -3.09
  Korean won     1114.10        1055.40       -5.27
  Baht             32.85          32.86       +0.02
  Peso             45.13          44.40       -1.62
  Rupiah        12175.00       12160.00       -0.12
  Rupee            62.16          61.80       -0.58
  Ringgit         3.3640         3.2755       -2.63
  Yuan            6.1246         6.0539       -1.15
    

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

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