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EM ASIA FX-Asian currencies recover on dollar profit-taking
May 12, 2017 / 6:08 AM / 7 months ago

EM ASIA FX-Asian currencies recover on dollar profit-taking

    * Malaysian ringgit flat ahead of policy review
    * Indian rupee rise ahead of inflation data

 (Adds text, updates prices)
    By Patturaja  Murugaboopathy 
    May 12 (Reuters) - Most of the Asian currencies edged up on
Friday, trimming their losses on the week, as traders took
profits in the dollar. 
    The dollar index, up nearly 1 percent for the week,
was set for its first weekly rise in five. It was down 0.1
percent on the day.
    "Obviously, there is bit of a profit-taking leading to more
strengthening of Asian currencies. Asian currencies have
weakened throughout the course of this week," said Khoon Goh,
head of Asia research at Australia and New Zealand Banking Group
in Singapore.
    "There is net positioning clean-up heading into the
    The South Korean won was trading flat, but added
nearly half a percent on the week. Moon Jae-in's appointment as
the new president propped up South Korean equities this week,
with the Korea Composite Stock Price Index (KOSPI)
hitting a record high on Wednesday.
    The Indonesian rupiah inched up, as the equity
markets rose after declines in the last two sessions.

    China's yuan was trading flat after the
People's Bank of China set the midpoint rate at
6.8948 yuan per dollar, about 0.15 percent firmer than the
previous fix.
    Overall, tensions over North Korea kept the regional
currencies in check this week. Pyangyang's ambassador to
Britain, Choe Il, said in an interview with Sky News on Tuesday
that North Korea was ready to conduct a sixth nuclear test. 
   "We have ongoing tensions in North Korea. At the moment
markets are not really pricing in too much of a risk premium
around it. So if there is any escalation in that, then
potentially it will lead to weakness in asset prices in this
region," Goh said.
    With China's manufacturing and factory-gate pricing
softening, the GDP figures from Thailand, Philippine and
Malaysia, due next week, will be closely watched.
    The Malaysian ringgit was trading flat ahead of the
central bank's policy review on Friday. 
    Most analysts expect the bank to keep the rate steady.
    "With resilient growth outlook, stable inflation dynamics
and stabilised MYR for the time being, BNM (Bank Negara
Malaysia) is expected to hold for now with the next move poised
to be a hike in 6-12 months," Mizuho Bank said in a note.
    Malaysia's industrial production in March rose
4.6 percent from a year earlier, government data showed on
Thursday, supported by strength in the manufacturing and mining
    The ringgit, which fell more than 4 percent last year, has
gained 3 percent this year.

    The Indian rupee rose 0.14 percent to 64.283 per
dollar, ahead of the inflation and industrial production data
due later in the day.
    India's inflation likely cooled in April due to lower food
prices, according to a Reuters poll of economists, but the
pullback may not give the Reserve Bank of India enough leeway to
ease monetary policy anytime soon.
    Strong equities, which were hovering near record highs, lent
support to the rupee, although analysts warn that stock 
valuations are stretched.
    Foreigners have sold Indian equities in eight out of the
last nine sessions on a net-basis through Thursday, according to
the exchange data. 
  Change on the day at                                         
        0545 GMT                                     
  Currency                  Latest bid     Previous    Pct Move
  Japan yen               113.740            113.84       +0.09
  Sing dlr                1.408              1.4067       -0.10
  Taiwan dlr              30.201             30.215       +0.05
  Korean won              1127.100           1127.9       +0.07
  Baht                    34.720              34.75       +0.09
  Peso                    49.850              49.91       +0.12
  Rupiah                  13335.000           13355       +0.15
  Rupee                   64.305              64.38       +0.11
  Ringgit                 4.346               4.346       +0.00
  Yuan                    6.901              6.9025       +0.03
  Change so far                                                
  Currency                Latest bid    End 2016       Pct Move
  Japan yen               113.740            117.07       +2.93
  Sing dlr                1.408              1.4490       +2.90
  Taiwan dlr              30.201             32.279       +6.88
  Korean won              1127.100          1207.70       +7.15
  Baht                    34.720              35.80       +3.11
  Peso                    49.850              49.72       -0.26
  Rupiah                  13335.000           13470       +1.01
  Rupee                   64.305              67.92       +5.62
  Ringgit                 4.346              4.4845       +3.19
  Yuan                    6.901              6.9467       +0.67
 (Reporting By Patturaja Murugaboopathy in Bengaluru; Editing by
Amrutha Gayathri)

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