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EM ASIA FX-Asia FX on track for weekly losses; Singapore dlr at 3-1/2-mth low
October 7, 2016 / 5:51 AM / a year ago

EM ASIA FX-Asia FX on track for weekly losses; Singapore dlr at 3-1/2-mth low

* Singapore to announce policy on Oct 14
    * Pound's plunge briefly puts more pressure on Asia FX
    * Won, ringgit over 2-week lows
    * Lower U.S. jobless claims point to strong labour market

 (Adds text, updates prices)
    By Jongwoo Cheon
    SINGAPORE, Oct 7 (Reuters) - Most emerging Asian currencies
fell on Friday with caution increasing ahead of key U.S. jobs
data, while regional units were on track for weekly losses after
fears of a potential cut in the European Central Bank's stimulus
spurred bond outflows.
    Regional currencies briefly came under further pressure from
the British pound's plunge to a 31-year low. The
sterling lost ground as anxiety over a "hard" exit by Britain
from the European Union triggered a wave of selling.
    The Singapore dollar hovered around its lowest
point in three and a half months as the city-state's central
bank said it plans to announce its semiannual policy statement
on Oct. 14. 
    South Korea's won and Malaysia's ringgit 
slid to their weakest levels in more than two weeks.
    Investors were awaiting U.S. September nonfarm payrolls data
due later in the day to gauge if the Federal Reserve will raise
interest rates by the year-end. The forecast is that 175,000
jobs were added last month. 
    The U.S. jobs market already suggested strength as data on
Thursday showed the number of Americans filing for unemployment
benefits unexpectedly fell last week to around a 43-year low,
adding to prospects of a near-term tightening. 
    Emerging Asian currencies are expected to weaken further if
the September employment indicator supports projections that the
Fed may increase borrowing costs in December, analysts and
traders said.
    Regional currencies, as well as bonds, fell on concerns that
possible tapering of the ECB's stimulus could reduce cheap money
    "If employment data confirms strength in the U.S. economy,
the Fed will have no choice but to hike rates. That will hurt
Asian currencies," said Jeong My-young, Samsung Futures research
head in Seoul.
    "Investors will have to consider if they need to cut bond
holdings in the world including Asia. Bullish bond factors
including ample liquidity backed by sluggish inflation and
growth are waning," Jeong said.
    Doubts over the effects of global monetary policy easings
are growing, while inflation rates are seen rising due to low
bases and higher oil prices, she added.
    The Singapore dollar has lost 0.8 percent against the U.S.
dollar so far this week as it slumped to 1.3743, its weakest
since June 24 when Britain's vote to leave the EU rolled the
global financial markets.
    Some investors bet on risks of possible easing by the
Monetary Authority of Singapore next week, although the central
bank is broadly expected to keep its exchange rate-based
monetary policy this month. 
    The won underperformed regional peers, having fallen 1.3
percent against the greenback so far this week.
    Foreign investors sold a combined net 963.6 billion won
($863.3 million) worth of South Korean bonds in the first three
sessions of October, a financial regulator's preliminary data
    Thailand's baht has slid 0.6 percent this week as
offshore investors cut local bond holdings.
    The ringgit has lost 0.4 percent so far this week, tracking
broad falls in Malaysia government bond prices 
despite higher oil prices and an unexpected increase in August
    Taiwan's dollar has eased 0.3 percent for the week,
while India's rupee has fallen 0.2 percent.
    The rupiah bucked regional depreciation with a 0.4
percent gain so far this week. Indonesia provides one of the
highest government bond yields in Asia, attracting foreign
    The Philippine peso has also risen this week by
0.3 percent.
    Foreign selling in Manila's equity market slowed,
spurring currency traders to unwind some bearish bets on the

    Change on the day at 0530 GMT
  Currency                Latest bid   Previous day   Pct Move
  Japan yen                   103.84         103.96      +0.12
  Sing dlr                    1.3736         1.3724      -0.09
  Taiwan dlr                  31.465         31.403      -0.20
  Korean won                 1116.20        1112.20      -0.36
  Baht                         34.89          34.84      -0.15
  Peso                        48.370         48.285      -0.18
  Rupiah                       12990          12986      -0.03
  Rupee                        66.78          66.69      -0.14
  Ringgit                     4.1500         4.1400      -0.24
  *Yuan                       6.6745         6.6745      +0.00
  Change so far in 2016                                       
  Currency                Latest bid  End prev year   Pct Move
  Japan yen                   103.84         120.30     +15.85
  Sing dlr                    1.3736         1.4177      +3.21
  Taiwan dlr                  31.465         33.066      +5.09
  Korean won                 1116.20        1172.50      +5.04
  Baht                         34.89          36.00      +3.17
  Peso                         48.37          47.06      -2.71
  Rupiah                       12990          13785      +6.12
  Rupee                        66.78          66.15      -0.95
  Ringgit                     4.1500         4.2935      +3.46
  Yuan                        6.6745         6.4936      -2.71
 * Chinese financial markets are closed for holidays this week
and will resume trade on Monday.

 (Reporting by Jongwoo Cheon; Editing by Richard Borsuk)

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