October 6, 2017 / 5:56 AM / 9 months ago

EM ASIA FX-Asian currencies shade lower as dollar supported by U.S.tax reform hopes

    By Hanna Paul
    Oct 6 (Reuters) - Asian currencies were modestly lower on
Friday as hopes of tax reform in the United States lifted the
dollar to seven-week highs, though improving risk sentiment
helped contain the losses.
     The U.S. House of Representatives approved a fiscal 2018
spending blueprint in an effort to hasten an overhaul of the
U.S. tax code, powering Wall Street to new peaks and the dollar
to its strongest level since mid-August at one point.

    The dollar retained its firm tone ahead of the non-farm
payroll data due later in the global day, which is expected to
reflect the impact of the hurricanes Harvey and Irma.
    Economists expect just 90,000 new U.S. jobs for September,
down from 156,000 in August, according to a Reuters
    Global risk sentiment was also boosted by gains on Wall
Street with the S&P index clocking its sixth consecutive record
high close, its longest winning streak since 1997.
    The CBOE Volatility index, which tracks the cost of
protection against a decline in the S&P 500, set a record
closing low.
    "The volatility index made a new low while the S&P index hit
a new high suggesting that despite a stronger dollar and
prospects of higher yields, the global economic environment
still supports risk assets," said Tariq Ali, investment
strategist at Standard Chartered Bank.
    "Hence, though we may see Asian currencies come off a bit in
the next few weeks ahead, losses will likely be limited," Ali
    The Singapore dollar , Taiwan dollar and the
Indonesian rupiah are on course for their fourth straight
week in the red.
    The Singapore dollar slipped to its lowest level in over 7
weeks. The Monetary Authority of Singapore will decide on 
policy on Friday where it's expected stand pat.
    Philippine Peso edged 0.2 percent lower and was
the worst performer among Asian currencies in the year.
    China and South Korea markets were closed for holidays.  
    The Indian rupee nudged lower. On a weekly basis,
it snapped three consecutive weeks of declines to eke out
marginal gains.
    Analysts polled by Reuters showed market participants turned
bearish on the Indian rupee for the first time in nearly nine
months after economic growth unexpectedly cooled to its slowest
pace in three years.
    The Reserve Bank of India is expected to release data on 
weekly forex reserves today.
    The following table shows rates for Asian currencies against
the dollar at 0524 GMT.

 Change on the day at 0524 GMT                          
  Currency                       Latest  Previous    Pct
                                    bid       day   Move
  Japan yen                     112.960    112.81  -0.13
  Sing dlr                      1.367      1.3640  -0.18
  Taiwan dlr                    30.365     30.350  -0.05
  Baht                          33.410      33.33  -0.24
  Peso                          51.120      51.01  -0.22
  Rupiah                        13500.0     13455  -0.33
  Rupee                         65.248      65.14  -0.16
  Ringgit                       4.235       4.227  -0.19
  Change so far in 2017                                 
  Currency                      Latest   End 2016    Pct
                                bid                 Move
  Japan yen                     112.960    117.07  +3.64
  Sing dlr                      1.367      1.4490  +6.04
  Taiwan dlr                    30.365     32.279  +6.30
  Baht                          33.410      35.80  +7.15
  Peso                          51.120      49.72  -2.74
  Rupiah                        13500.0     13470  -0.22
  Rupee                         65.248      67.92  +4.10
  Ringgit                       4.235      4.4845  +5.89
 (Reporting by Hanna Paul; Editing by Shri Navaratnam)
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