January 10, 2019 / 5:43 AM / 4 months ago

EM ASIA FX-Asian currencies helped by Sino-U.S trade optimism; rupiah tops gainers

 (Adds text, updates prices)
    By Aby Jose Koilparambil
    Jan. 10 (Reuters) - Asian currencies rose slightly on
Thursday as the dollar remained shaky on expectations the U.S.
Federal Reserve will soon pause its tightening cycle, while
renewed optimism over a Sino-U.S. trade deal lifted appetite for
riskier assets.
    Minutes from the Fed's policy meeting last month showed that
several policymakers did not feel the need to rush into further
rate increases in the face of global growth concerns.

    In other developments, China's commerce ministry said trade
talks between the world's top two economies this week were
extensive, and helped establish a foundation for the resolution
of each others' concerns.
    Vishnu Varathan, a senior economist at Mizuho Bank, said in
a note on Thursday that investors in Asian currencies are likely
to remain patient as they followed the progress of the Sino-U.S.
trade talks. 
    The Indonesian rupiah extended its positive start
to the year, gaining as much as 0.7 percent in the session for
around a 2.5 percent rise so far in 2019. 
    The Malaysian ringgit was another highlight on the day, up
0.5 percent to 4.093 against the dollar, its highest level in
more than four months.
    The Korean won also rose 0.5 percent while the
Thai baht added 0.4 percent to touch a seven-month
peak.
    
    CHINESE YUAN
    The Chinese yuan strengthened as much as 0.5
percent for its best levels since July 2018 in breaching the key
6.8 per dollar level, despite data showing the nation's producer
prices in December rose at their slowest pace since September
2016.
    "The yuan will be supported by both a likely promise by
China to shrink the bilateral trade imbalance, and also the
expansion of domestic Chinese demand on account of expansionary
fiscal and monetary policy easing," said Julian Wee, a
Singapore-based Investment Strategist at Credit Suisse.
    
    INDIAN RUPEE
    The Indian rupee shed 0.2 percent as the currency
of the world's sixth largest economy felt the pressure from
rising oil prices and domestic political factors.
    The rupee, the worst regional performer in 2018, has
depreciated about a percent so far this year to lead decliners
among its peers.
    "The rupee is expected to come under pressure as crude
prices are rising. The upcoming federal budget is expected to be
populist after the ruling party's defeat in the state elections
last month. This might put pressure on the fiscal arithmetic,"
said Rushabh Maru, research analyst at Anand Rathi Shares and
Stock Brokers.
    
    The following table shows rates for Asian currencies against
the dollar at 0536 GMT.
    CURRENCIES VS U.S. DOLLAR
    
 Currency               Latest bid  Previous day  Pct Move
 Japan yen              107.900     108.16        +0.24
 Sing dlr               1.351       1.3533        +0.17
 Taiwan dlr             30.763      30.801        +0.12
 Korean won             1118.400    1122.1        +0.33
 Baht                   31.910      32.01         +0.31
 Peso                   52.150      52.2          +0.10
 Rupiah                 14045.000   14120         +0.53
 Rupee                  70.580      70.46         -0.17
 Ringgit                4.095       4.113         +0.44
 Yuan                   6.792       6.8175        +0.38
                                                  
 Change so far in 2019                            
 Currency               Latest bid  End 2018      Pct Move
 Japan yen              107.900     109.56        +1.54
 Sing dlr               1.351       1.3627        +0.87
 Taiwan dlr             30.763      30.733        -0.10
 Korean won             1118.400    1115.70       -0.24
 Baht                   31.910      32.55         +2.01
 Peso                   52.150      52.47         +0.61
 Rupiah                 14045.000   14375         +2.35
 Rupee                  70.580      69.77         -1.15
 Ringgit                4.095       4.1300        +0.85
 Yuan                   6.792       6.8730        +1.19
 
 (Reporting by Aby Jose Koilparambil and Nikhil Nainan in
Bengaluru
Editing by Shri Navaratnam)
  
 
 
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