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EM ASIA FX-China's easing, concerns on Greece pull Asia FX lower
February 5, 2015 / 6:39 AM / 3 years ago

EM ASIA FX-China's easing, concerns on Greece pull Asia FX lower

* Won falls as foreigners sell stocks, bonds
    * Ringgit down on oil; Dec trade data cuts losses
    * Taiwan dlr up despite Jan CPI's biggest slump in 5 yrs

 (Adds details, updates prices)
    By Jongwoo Cheon
    SINGAPORE, Feb 5 (Reuters) - Most emerging Asian currencies
softened on Thursday after China's central bank cut the reserve
requirement ratio, the latest key easing move in the region to
support growth and combat deflationary pressure.
    Regional currencies came under further pressure as risk
sentiment soured after the European Central Bank said it would
no longer accept Greek bonds as collateral for its liquidity
operation, dampening hopes for a resolution of Greece's debt
woes. 
    The Chinese yuan slid after the central bank late
on Wednesday made a system-wide cut to bank reserve
requirements, the first time in over two years. 
    South Korea's won fell as foreign investors sold
local stocks and bond futures amid risk
aversion. Malaysia's ringgit eased as oil prices
renewed their slide.
    "Emerging countries continue to ease (monetary policy) and
Asian currencies are competitively depreciating," said Yuna
Park, a currency and bond analyst at Dongbu Securities in Seoul.
    "In addition, risks from Europe are never ending," Park
said.
    Growing expectations that policy easing will spread across
Asia hurt sentiment towards regional currencies over the past
two weeks, with short positions on China's yuan at a near
10-month high, a Reuters poll showed. 
    
    WON
    The won slid as traders cut long positions in the
South Korean unit which they had built up expectations of demand
from exporters for settlements.
    Seoul shares ended down 0.5 percent, underperforming MSCI's
broadest index of Asia-Pacific shares outside Japan.
 

    RINGGIT
    The ringgit initially underperformed Asian peers as
plunging oil prices renewed concerns over their impact on the
country's current account surplus and fiscal deficit.
    The currency, however, pared some earlier losses as exports
in December rose 2.7 percent from a year earlier, more than 
expected. 
    Government bond prices rose with the 10-year yield
 down to as low as 3.759 percent, its lowest since
November 2013.
    
    TAIWAN DOLLAR
    The Taiwan dollar rose as continuous foreign stock inflows
helped it ignore data showing consumer and wholesale prices in
January posted their largest fall in more than five years.
 
    Economists said there was no danger of the island slipping
into deflation as the drop was mainly due to the plunge in world
oil prices, rather than a broad-based slump in demand.
    Foreign investors are expected to buy local shares 
despite a slide in the main index, currency traders said.
Foreigners purchased a combined net T$22.3 billion  ($709.3
million) of stocks in the first three days of the month,
according to Taiwan Stock Exchange data.
    
    CURRENCIES VS U.S. DOLLAR
    Change on the day at 0633 GMT
  Currency    Latest bid   Previous day    Pct Move
  Japan yen       117.11         117.28       +0.14
  Sing dlr        1.3488         1.3485       -0.02
  Taiwan dlr      31.454         31.473       +0.06
  Korean won     1089.73        1084.10       -0.52
  Baht             32.60          32.62       +0.06
  Peso             44.14          44.11       -0.06
  Rupiah        12650.00       12620.00       -0.24
  Rupee            61.87          61.75       -0.19
  Ringgit         3.5750         3.5625       -0.35
  Yuan            6.2546         6.2477       -0.11
 
  Change so far in 2015
  Currency    Latest bid  End prev year    Pct Move
  Japan yen       117.11         119.66       +2.17
  Sing dlr        1.3488         1.3260       -1.69
  Taiwan dlr      31.454         31.718       +0.84
  Korean won     1089.73        1099.30       +0.88
  Baht             32.60          32.90       +0.92
  Peso             44.14          44.72       +1.33
  Rupiah        12650.00       12380.00       -2.13
  Rupee            61.87          63.03       +1.87
  Ringgit         3.5750         3.4965       -2.20
  Yuan            6.2546         6.2040       -0.81
  ($1 = 31.4400 Taiwan dollars)

 (Additional reporting by Lin Miao-jung in TAIPEI; Editing by
Richard Borsuk)

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